Ethereum price analysis: Reversal threatens key support as Vitalik Buterin looks to Zcash’s ZK-SNARKs for Ethereum scability woes
|- “We can actually scale asset transfer transactions on ethereum by a huge amount…,” Vitalik Buterin wrote in regards to ZK-SNARKs.
- Ethereum finds a pit stop support at $210 after 7.56% declines on the day.
Ethereum languishing in selling pressure days after the bullish rally that had it test the resistance at $250. The investors had begun seeing $300 in sight again. However, the bears had a totally different plan for Ethereum price. In the past couple of days Ethereum backed on a journey of massacring lifeline support areas highlighted at $240 $220 and $210. The bear trend is threatening further breakdown below $200. The drop below $170 earlier this month is still fresh in the mind of the bulls, which means that they are willing do to all they can to avoid a dip below $200.
The founder of Ethereum, Vitalik Buterin has recently suggested that Zcash’s ZK-SNARKs technology could be the answer to Ethereum’s scalability issues. Buterin wrote on a research forum:
“We can actually scale asset transfer transactions on ethereum by a huge amount, without using layer 2s that introduce liveness assumptions (eg. channels, plasma), by using zk-SNARKs to mass-validate transactions.”
ZK-SNARKs stands for (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge). The solution is built using zero-knowledge proofs that were discovered by various MIT researchers in 1980. This technology is already in operation with various privacy coins like Zcash. It works in such a way that a couple of parties that are transacting verify certain aspects of information but neither reveals the contents of the information. In this case, Buterin says that a method referred to as a “relayer” node that represents a computer that is carrying out specific tasks aggregates the transactions in return a fee is paid.
“Anyone can be a relayer; there is no assumption of even an untrusted special ‘operator’ existing,” Buterin explains.
He further estimates that this technology has the ability to revamp the Ethereum network with “~24x for ETH transactions and ~50x for ERC-20 transfers.”
Meanwhile, Ethereum also broke the trendline support at $232.8 which triggered additional declines below $230 and $220 consecutively. The bear trend dropped below the current support at $210 forming a low at $207 before recovering slightly. At the time of writing, Ethereum is trading at $211 while embracing the short-term support created at $210. The price is trading below the moving averages to show that the bears have the strongest influence. On the upside, the broke support at $220 will now act as a significant hurdle as the price attempts to recover to $230. Likewise, the price must be kept above the short-term support.
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