ETHEREUM GAINS AS JAPAN PROVIDES SUPPORT
After weeks of declines, ethereum reached a low of $350 last Friday. After that, the ETH/USD pair has been making significant gains, soaring to a high of $426 this morning. At the same time, the price of bitcoin has formed a plateau, trading between a range of $7450 and $6400.
The surge in ethereum’s price is possibly because of Japan. A recent report by BTC Manager found that while most countries were focusing on regulations and shutting down exchanges, Japan was coming up with regulations to support the cryptocurrencies market. In addition, the country’s Financial Services Agency has been granting licenses to many cryptocurrencies exchanges. Japan is the third largest economy in the world with a GDP of almost $5 trillion.
Japanese support for the industry should not be understated. In recent months, China has banned ICOs and exchanges, South Korea has threatened the industry, and just yesterday, Australia placed major regulations on cryptocurrencies exchanges. In a statement, the Australian Transaction Reports and Analysis Center (ATRAC) said that all exchanges in the country must register immediately. At the same time, major debit and credit card providers announced that they would not allow cryptocurrencies transactions.
The rise in price may also be due to the official launch of Golem on the Ethereum Mainnet this week in beta form. The so-called ‘Airbnb for computers’ enables users to essentially ‘rent out’ idle CPU to others in exchange for cryptocurrency.
Also aiding the increase in price are the technical indicators that recently showed the ETH/USD pair being in the oversold zone. The pair is currently trading at $425. This rise could continue as the tax season in the US ends. However, in the short term, the pair could retrace to about $410 or $400 levels which are important Fibonacci Retracement levels.