With the rise of altcoins and stablecoins, the value of ETH comprises only 51% of its blockchain, according to Messari's CEO.
According to Ryan Selkis, CEO of Messari, a cryptocurrency analytics company, the added value of all ERC-20 tokens has increased dramatically to $ 25.6 billion and is now responsible for 49% of the total assets of the Ethereum blockchain. .
The recent high value of ERC-20 tokens, such as LINK, CRO and COMP, has threatened the Ethereum domain in the DeFi space – as ETH now represents only 51% of the total value of the Ethereum blockchain.
Selkis stated: “Now, Ether is responsible for 51% of the guaranteed value on the Ethereum blockchain, which is the smallest percentage amount that is accounted for in its history. The other 49% of the value stored on Ethereum now encourages economic activity in addition to the maintenance and execution of the Ethereum blockchain ”.
The DeFi craze
ERC-20 are tokens designed specifically to run on the Ethereum blockchain. Together, they can be shared and exchanged with each other, creating an ecosystem of altcoins within the Ethereum blockchain.
These tokens are not only a form of investment in cryptocurrencies, but also a facilitator in the DeFi industry.
DeFi, or decentralized financing, uses smart contracts on the Ethereum blockchain to recreate traditional financial instruments without the usual disadvantages of intermediaries. Blockchain also addresses the issue of bank accessibility.
Recent developments in the DeFi space, such as the introduction of the Compound token (COMP), have increased the price of altcoin by 365% over the initial value. It started at $ 80 and went up to a historic high of $ 350.
Recently, LINK also increased by 370% in value. This is probably due to the increased use of DeFi, where the demand for decentralized oracles that make smart contracts work, like Chainlink, has increased rapidly.
The CRO has increased from $ 426 million to $ 2.6 billion and is now an important value component of the Ethereum blockchain.
Some experts have speculated how the LINK token managed to record an incredible amount of growth in the short term. Cointelegraph speculated that the meteoric rise in LINK may be the result of “an elaborate Chainlink pump-and-dump scheme”.
While many suggest that the rapid growth of DeFi is a bubble, this will not be known until later.
The launch of the COMP token was a huge success, with people investing their digital assets in it. However, it has fallen from historical highs and at the time of writing it is sitting close to half of its last highest records.