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Are Low Network Usages Responsible For The Fragile State Of The Cryptocurrency Market?

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Jason Palmer has taken to Twitter today. He has been musing as to why news that is so irrelevant on the entire market for cryptocurrency. The Dogecoin creator has stated that he believes that low-usage networks are responsible for the fragility of the cryptocurrency market. This is especially the case when you look at the fact that the entire market is now moving again together. The wisdom behind a move like this is the Bitcoin ETF decision. This has been postponed by the SEC but a news event like this should not have any impact on the entire market in a way like this. A lot of people in the space have predicted that the SECC would have to take as much time as possible so that they could then either approve or even deny a Bitcoin ETF. The recent news story is completely negligible and it shows that there has been some kind of response to this.

 

What’s even more is that the decision is going to affect the price of Bitcoin. The entire market is in  the red at the moment and Bitcoin is one of the biggest when it comes to capitalisation. Bitcoin has dropped in the last 24 hours and it is at almost 12% at the moment. It is interesting to see that XRP has dropped by 20% over the period when a decision would not have any bearing at all on an unrelated asset such as this. When you look at the Twitter feed you will see that Palmer has speculated that the deadline sin price were indicative of the currency networks. They have also spread to weaker markets and he has stated that all of this is down to under utilisation. He has even posted some graphs to try and illustrate his point. The first of Bitcoin’s transactions show that the figure for July 2018 is much lower when compared to the two years that are on the graph.

 

The second image shows the daily users and even their own decentralised applications. At the time of writing this article, there are 10,000 users who continue to use dApps. It’s not made it clear whether or not all networks are capable of supporting something such as dApps or whether the largest ones are going to handle it but either way, it’s safe to say that the picture is damning for a network when you have $36 billion pumped into it. So now let’s take a look at the next graph. It is easy to see that the highlights of the number of transactions that are occurring on the ETH network over the last year or so. The ETH figures are also very, very low. It shows around 635,000 transactions every single day but Palmer has added a caption to the image to try and explain things even more. He has stated that when you have hundreds of billions of dollars poured into a technology, you probably don’t expect this kind of growth in return. He then turned his attention to XRP. This is the native currency on the Ripple network. He has highlighted that the network is in fact processing fewer payments each day when compared to a couple of years ago. This indicates that a network that is built to handle transactions is not actually being used for the purpose that it was created for. In conclusion. Palmer has also come out to say that he has heard that other people believe that these networks are not proof that the market is fragile. If Palmer’s musings a re correct then there will need to be some kind of substantial adoption to make sure that everyone is able to build on a market that has not only good volatility but also something that is the norm.

 

conclusion. Palmer has also come out to say that he has heard that other people believe that these networks are not proof that the market is fragile. If Palmer’s musings a re correct then there will need to be some kind of substantial adoption to make sure that everyone is able to build on a market that has not only good volatility but also something that is the norm.

 

 

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