Hallelujah! After a week of non-stop pain, investors finally moved past China’s ban on cryptocurrency exchanges. They bid up prices, bet on fundamentals, and were rewarded with flashing green numbers on their trading monitors.
For instance, the Ethereum-to-USD exchange rate jumped 17% to $280.69 on Sunday.
Considering that it slipped below $200.00 on Friday, the rebound was particularly steep. Who said there’s no resilience in cryptocurrencies? It took less than a week to shrug off China’s ban, which was definitely more than a flesh wound.
Ethereum gained against Bitcoin as well, suggesting that investors are remembering the differences between various blockchains. But don’t be fooled; the short-run Ethereum price forecast is tied to the broader cryptocurrency outlook.
Investors will need several weeks before currency-specific news will drive prices. That said, there’s a ton of Ethereum news ready for that day.
For example, French insurance giant Axa SA (EPA:CS) is testing a smart contract on Ethereum’s platform. The contract would automatically pay out travel insurance if someone’s flight is delayed, smoothing out a wrinkle in the often hectic business of air travel.
Right now, the pilot program (pardon the pun) only covers flights from Paris to the U.S., but it could have enormous uptake.
I would personally love for the market to judge ETH on its use-cases (like the one shown above). But investors are too blinded by regulatory roadblocks to heed that kind of nuance.
The fear of another crackdown is keeping them cautious in the short term, particularly as other countries clarify their positions on cryptocurrencies.
However, there’s some good news on that score. Most jurisdictions are striking a friendlier tone than China, evidenced by a recent ruling from Canadian authorities.
They wrote that “the technology behind cryptocurrency offerings has the potential to generate new capital raising opportunities for business and we welcome this type of innovation.” (Source: “Canada Confirms Tokens May Be Securities and Pacific Coin Is the Test,” CoinDesk, September 17, 2017.)
So if you’re bullish on ETH, pray that more and more countries take the Canadian route.