Ethereum already has an appreciation of over 1200% in less than 12 months
Although Bitcoin has monopolized the cryptocurrency narrative thanks to its parabolic high in 2020, Ethereum could become the choice of many based on the fact that it is very different from the Bitcoin value storage narrative.
Ethereum closed Sunday at $ 1,392, very close to its previous record. The second largest cryptocurrency has grown 1,200% since March 2020, when 1 ETH was equivalent to just $ 80. Ethereum’s market capitalization currently stands at $ 160 billion.
The continuing demand for developers to continue building on the Ethereum blockchain is proof of its value. Most cryptocurrencies were actually ERC-20 tokens built on Ethereum, despite new competitors arriving to take the dominant blockchain market.
The increase in the volume of transactions is also a case of high for Ethereum, since only in 2020, $ 1 trillion in transactions were facilitated on the Ethereum blockchain. Total fees could have been higher had it not been for cases in which transaction fees sometimes became exorbitant for small transactions. However, the fact that users are willing to pay higher fees to have their transactions confirmed means that the demand for the cryptocurrency is still increasing.
Decentralized finance or DeFi, which are combinable finance without the need for any human intermediary, exploded in popularity in 2020, especially in August. Some of the DeFi coins were priced higher, with YFI at one point having a higher price than Bitcoin. Decentralized finance has also given rise to automated market makers, such as Sushiswap and Uniswap, who have sent tokens to their users.
The total amount blocked on DeFi is currently $ 26.55 billion, with the majority blocked on the Ethereum blockchain, according to the DeFi Pulse. The Cointelegraph observed that although DeFi created a free market for everyone, the interest of institutional investors may be reaching the sector.
In a previous report, FundStrat valued Ethereum at $ 10,500, fueled by fees and DeFi. Still, there are still risks, including a low-potential market and any delay around the launch of Ethereum 2.0.