The price of classic ether (ETC) has plunged over the past week, as the original excitement surrounding the newly created digital currency appears to have worn off with investors.
The adjustment would appear to have taken some of the momentum out of the nascent ethereum classic blockchain, which has enjoyed notable price gains and trading volume despite the fact many analysts expected it to die off shortly after its unlikely creation.
But those gains came to a halt this week, as ETC plunged 23.47% against ether (ETH) during the seven-day period, and it experienced a 23.16% loss against the US dollar in that time, Poloniex data reveal.
At press time, the price was up slightly at 1.5% over the last 24 hours.
For those who are less familiar, the digital currency came into existence in late July when idealists who opposed ethereum’s (ETH) hard fork began supporting a market for its old blockchain, one that was free from a contentious technical change.
Digital currency exchange Poloniex helped provide classic ether with some validation by listing the ETC/BTC and ETC/ETH currency pairs on 24th July. After, ETC quickly rose in value against ETH, surging more than 2,000% in early August.
Volumes, enthusiasm wane
This week’s price movements took place amid a backdrop of weak trading volume.
Market participants traded $38.1m worth of ETC during the period, with daily transaction activity ranging from as little as $1.87m to as high as $9.5m, according to CoinMarketCap figures.
In comparison, ETC’s trading volume surged in late July and early August, reaching $103.1m on 26th July and $147.86m on 2nd August.
After ETC enjoyed this strong start, some have expressed concern the digital currency is suffering excitement fatigue.
This a widespread problem for altcoins, many of which suffer declining interest because they don’t have much to offer beyond their speculative value, Petar Zivkovski, director of operations for bitcoin trading service Whaleclub, told CoinDesk.
He said:
“When volumes die off as they did this summer month of August, there is no more speculative demand to sustain prices, so they decline, in some cases quite sharply.”
But Zivkovski emphasized his view that ETC has more promise than many other altcoins, and stated that this digital currency might go through cycles like this periodically. He said this differs from other altcoins that only go through one or two such cycles before their volume dries up.
Some of ETC’s supporters are very passionate, noted Jacob Eliosoff, a cryptocurrency investment fund manager. As a result, they probably won’t “call it quits” so soon, he asserted.
However, he emphasized that not all of ETC’s backers share this level of excitement, and that some of these supporters may be lukewarm about the currency.
“There may be a quieter majority who were less committed and are moving on,” he stated.
Trading chart display via Shutterstock