Ethereum’s price eclipses $2000 for a new all-time high and the coin has more than doubled since the start of the year so let’s read about it in today’s ETH price news.
The second-biggest cryptocurrency by market cap has just reached $2000 for the first time ever which represents a 168% gain since the start of the year. BTC started off with a larger cap and grew about 93% in the same time span. The rise in the price has been mostly fueled by two factors. First, the institutional and retail investment in BTC helped to boost the interest in crypto overall. Since the start of the year, BTC moved from $32K to a price of $56 while most of the coins doubled in price as well, including ETH.
Second, the decentralized finance space that runs on top of Ethereum’s blockchain was booming and after a few years of the network looking great, it found a way through DeFi apps to allow people to lend money and swap assets without going through financial institutions and to accrue interest. DeFi Pulse tracks 70 different ETH-based DeFi applications and also measured that total value in these applications hit $42 billion. Paul Veradittakit who is a partner at Pantera Capital said:
“ETH hitting $2000 validates that scalability, applications around DeFi and NFTs are hitting hockey stick growth, and it is proving itself to be the leader in creating decentralized applications. This all leads to eventually an institutional-grade asset class.”
In terms of institutional-grade assets, there are now more ETH-based financial instruments that are available to investors from the Grayscale ETH trust in the US to the Ether fund on the Toronto Stock Exchange. The CMO at MyCrypto Jordan Spence said that the price rise happened due to a combination of factors:
“The upwards price movement is a culmination of the entire industry putting in the work these last few years, and more people are catching on and want to get involved.”
The price could not be done going up as he pointed out because we saw a ton of growth among ETH and DeFi and even more is on the way. ETH 2.0 which is the proof of stake replacement of the network, launched back in 2020 but it isn’t fully functional. The hope for all ETH supporters is that it will solve the congestion issues and will allow value to flow freely across the network and will also eliminate the need to use rival blockchains.
Ethereum’s price eclipses 00 and given everything that has been going on, the new price floor could be lower than this level in the near-term but seeing the numbers around, you should not be surprised if it surges higher.
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