We are “mooning” today – today is the day when the Earth and the Moon will come the closest (221,681 miles or 356,761 km) in 2019. In the anticipation of this event, ether started to “moon” yesterday. Has the crypto community been right all along – and the cryptocurrency price fluctuations are correlated with the movement of the Earth’s satellite? Stranger things have happened in the past, but this is unlikely. A more plausible explanation for this phenomenon is the upcoming Constantinople Fork that is currently planned for 7,280,000 which should occur on February 27, 2019
Flag of the Republic of Turkey, Hagia Sophia in Istanbul.
The irony here is that crescent is on the flag of Turkey, which is the successor to the Ottoman Empire. The Ottomans are those that conquered Constantinople, destroyed the Byzantine Empire, renamed Constantinople to Istanbul, and replaced the cross on Hagia Sophia with the crescent moon. There is no doubt that Mr. Buterin is aware of this historical curiosity as one of the prior forks was called Byzantium – that what Constantinople had been called before emperor Constantin gave it an eponymous name.
But let’s switch back from the history of Constantinople to the history of ether price movements following various Ethereum forks predating the Constantinople fork. There have been seven Ethereum hard forks thus far, four of the forks that had been on the original roadmap and three forks had been ad hoc reactions to the discovered vulnerabilities. We examined the movements in Ether price 30 days prior to the fork versus the price 30 days after the fork for all the past forks except for the very first fork – Frontier – as it took place before ether was introduced into the markets.
The average change for all the forks is an unexciting -0.19%. However, once we segment the forks into “on the roadmap” and “not on the roadmap”, we start seeing more interesting results. The average change for the three forks that were not “on the roadmap” is -20.83% and for the other three, it is 20.45%. Furthermore, if we exclude the Frontier Thawing Fork which took place in 2015 when there was no real market established for ether, then the average change for “on the roadmap” forks becomes 37.50%. And this distinction makes intuitive sense – the forks that were on the original roadmap are expected to add new features, improve efficiency etc., whereas the ad hoc ones pinpoint the shortcomings of the original design and infuse general uncertainty about the overall design of the platform.
The -30 day for the upcoming Constantinople Fork is December 29, 2018, ether price on the closing of that day was $105.01. If we were to forecast the price of ether on the +30 day – assuming that the fork does happen on February 27, 2019 – then we expect $126.48 (based on the average for all the “on the roadmap” forks) or $144.38 (excluding Frontier Thawing Fork). Although at the time of this writing the price of ether has already exceeded even the more liberal prediction, it is important to note that the price doesn’t necessarily move in the linear fashion. In addition, the upcoming fork is only one of many factors that affect the price; other factors could either override the “fork effect” or amplify it. There is no denying the fact that this approach for the prediction of the price movement lacks scientific rigor, it sure beats the “when Moon?” approach.