The price of Ethereum (ether) has hit an all-time high after surpassing its value in less than a month. The cryptocurrency sky-rocketed to $1,430 on Tuesday, according to CoinMarketCap’s price index. It indicates a remarkable return for Ethereum holders, who witnessed a drop below $100 in the month post it’s 2018 high. It underwent a uniform recovery during 2020 till an unexpected price surge in late December rose its value from approximately $600 to its prevailing record highs. Ethereum’s resurgence comes amidst a market-wide bull run that has witnessed notable gains for the most significant cryptocurrencies. It comprises Bitcoin and Litecoin.
Further, there are various factors behind the increase in the price of Ethereum. Firstly, and the most fundamental one is the surge in DeFi. Since April last year, the total value locked in multiple protocols is approximately $25 billion – an improvement of roughly 4500%. Moreover, the community saw a vibrant ecosystem with thousands of protocols with their native cryptocurrencies. The vast majority of them operate on Ethereum’s network, pushing the demand for ETH through the roof. This has also emphasized some of the blockchain’s problems; nevertheless, as transaction fees have become so high, several have alleged that DeFi is only useful for more comprehensive investors.
ETH 2.0 plays a major pole in ETH price rise
Moreover, the launch of ETH 2.0 also plays a significant role in the price rise. Ethereum 2.0 acts as the solution to the sky-high fees and the closed network. With Ethereum 2.0, the network will transfer to a Proof of Stake (PoS) consensus algorithm and Phase 0 went officially live in December. This indicated a significant milestone, and even though it could be a few more years until the launch of the upgraded network, it undoubtedly performed a significant part in the price for ETH. Meantime, users can now stake their ETH tokens to support ETH 2.0.
Moreover, the price of Ether (ETH) could reach $10,500, according to a strategist at significant market research company Fundstrat, Global Advisors. Fundstrat strategist David Grider illustrated ETH tapping new historical records of nearly $1,430 in an investor note on Tuesday. Grider stated that the second-largest cryptocurrency could rise more than sevenfold to $10,500 after placing a new record.
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