Ethereum’s Double-Edged Sword: Will a Rising Price Hurt Users?

sword, ancient

Ethereum supporters have every reason to be elated.

Not only has the value of the platform’s ether tokens jumped by about 900% since the start of the year, but the public blockchain has recently attracted attention from banks and tech behemoths. And while ethereum supporters have long argued that the global computing platform would help to form a new kind of internet, a wave of innovators are now trying to deliver on that ideal.

The problem is that there might be downsides to this increase in price and increase in attention. Namely, as the price increases, ethereum apps grow more expensive to use.

That’s because on ethereum, users need to pay directly for the computational power they use, whether to place a bid on a prediction market or use new kinds of decentralized Twitters and Ubers. For now, this is a different picture than, say, Facebook, the popularity of which rests in part on its ‘free’ platform.

Matus Lestan, co-founder of the ethereum app Ethlance, for example, recently posted a screenshot of a user looking to create a user profile on the platform – an action that cost 0.08 ETH, or $7. It would have cost “little more than $1” when ether was at $10,

Read more ... source: CoinDesk

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