Will The Deflationary Cryptocurrencies Prevail?
Photo by André François McKenzie at Unsplash
Two days ago Bitcoin, Bitcoin Cash, Bitcoin SV, and Dash all increased to recent high levels. They have retraced a bit since the two day euphoria, but that is the usual. The unusual circumstance is that Ethereum, Litecoin, Ripple, and Stellar did not produce similar effects. Does a rising tide lift up all crypto boats? Not exactly or at least not this time.
Augur and Ethereum Classic where the two cryptocurrencies which did rise in value. Augur increased in value in two spurts yesterday. It reached a high of $22.10 and then Ethereum Classic reached a high of $7 which are increases from the previous year. Why these two cryptocurrencies increased while the more established or higher valued cryptocurrencies like Ethereum, Litecoin, Ripple, and Stellar did not increase could be to a few possibilities.
Augur similar to Dash, Bitcoin, Bitcoin Cash, and Bitcoin SV has a relatively low amount of circulating coins as compared to the other cryptocurrencies. Cryptocurrencies that can continue to increase the amount of coins circulating would be inflationary in nature while those discussed in the beginning of the paragraph would be deflationary. Does that mean that coins that have a deflationary status will be less likely to increase in value? Not exactly, but this may be part of the case for the previous rise in value of some cryptocurrencies.
What about Ethereum Classic? Ethereum Classic has the same amount of circulating coins as Ethereum, but why would Ethereum Classic be chosen above Ethereum. Are the Ethereum 2.0 updates points to consider on the long term run of Ethereum? Is Ethereum Classic a better vision of Ethereum in the long run? Obviously these are just suppositions and one recent price increase does not prove anything, but they are still possibilities.
Stellar and Ripple have made very small gains recently. Both currencies share similar purposes although to different niches. With the current news of Stellar’s Interstellar Network being used in Asia to help bank the unbanked or at least help them be connected to an easier payment center, it is to be seen what happens to Stellar. The use cases are more important than the actual values presented, although it is still fascinating seeing the psychology and action behind the pricing of cryptocurrencies.