Ether token has seen strong momentum in July. It coincides with a five-year anniversary for the dominant smart contracts blockchain protocol.
There appear to be two key factors fueling the rally of ETH. First, the anticipation of the market towards ETH 2.0 has been continuously building. Second, the explosive growth of the decentralized finance (DeFi) market has upheld the momentum of Ethereum.
Since then, several major DeFi platforms have emerged. According to Defipulse.com, Aave, Balancer, and Curve Finance have $482 million, $291 million, and $263 million locked in, respectively.
The upward trajectory of the DeFi market could positively affect Ethereum for various reasons. The most prominent factor is its usage as gas. When users clog the Ethereum blockchain with many transactions, ETH is needed to pay transaction fees or “gas.”
According to Etherscan, the amount of gas used per day has increased to a new all-time high at above 76 million. The data suggests the demand for ETH is increasing in tandem with the user activity of the Ethereum blockchain.