Ethereum hasn’t made much headlines since the enthusiasm surrounding DeFi started to wane, but that doesn’t mean it won’t soon surprise everyone.
All the talk in the crypto space this week focused on Bitcoin. The cryptocurrency managed to make big gains after the news about PayPal that now wants to support it, which spurred that bullish momentum, leading Bitcoin to surpass the $ 13,000 mark. Bitcoin prices rose further and registered a new high in 2020, after reaching $ 13,200.
Meanwhile, Ethereum has caught only a brief wave of enthusiasm, although industry experts believe it can grow even further. With the launch of Ethereum 2.0 closer each day, we could probably see the price of ETH rise to a new high.
Ethereum gained just over 4% after starting the week at $ 380. Yesterday, ETH managed to reach $ 400, but failed to stay the course and fell instead. On an extended scale, however, Ethereum did much better and outperformed Bitcoin by a factor of two.
This performance is likely to continue in the coming months, as fundamental, on-chain and technical indicators strengthen. There is also another increase based on the current prices of both cryptocurrencies. Ethereum is trading around 70% below its historical high compared to Bitcoin, which is just 35% below its peak.
According to its founder Vitalik Buterin, Ethereum is more than protection against fiat, and can only be described as a complete financial ecosystem. He believes that ETH should no longer be seen as an altcoin because it has developed and has seen a large overall growth in the past five years.
The incredible amount of 9 million ETH has been blocked in decentralized finance so far. This translates to 8% of its maximum offer and represents an increase of more than 200% since the beginning of the year. A large percentage of Bitcoin is kept in cold storage, while ETH is being invested to earn more ETH and rewards on other crypto assets. A number of institutional investment funds, such as Grayscale, recently joined ETH because it is seen as undervalued.
DeFi was undoubtedly the biggest catalyst for ETH prices this year. Its impact was significant, although not as much as that of the initial currency offers for ETH prices three years ago. The next major potential driver of ETH prices will be the launch of Ethereum 2.0.