On Monday, May 3, 2021, Ethereum rose to its all-time high of $ 3,060.13 per coin. Daily growth was 8.5%, bringing its market capitalization to $ 337 billion. This impressive figure outstripped the total market capitalization of such large companies as Procter & Gamble, PayPal, Nestle, Bank of America.
Bitcoin’s closest competitor, Ethereum, has grown by over 200% in 2021, compared with a 95% rise in Bitcoin. We should note also that over the past week, the price of the largest altcoin by capitalization has increased by almost half. This happened while Bitcoin was trading well below its historic highs.
And despite Ethereum’s new all-time high, Bitcoin continues to trade below its peak.
Earlier, the American bank JPMorgan named three reasons why Ethereum superior to Bitcoin. The company’s analysts pointed to the altcoin’s more stable liquidity, less dependence on the derivatives market, and higher transaction speed.
What is the reason for the growth of ETH?
Recent growth linked to improvements made to the Ethereum blockchain. As well as a growing shift towards decentralized finance (DeFi). DeFi refers to transactions outside of regular banking, where the Ethereum blockchain is an important platform. According to DeFi Pulse, $ 71 billion currently locked into DeFi services, a figure that doubled in the past three months.
Earlier, an important update of Berlin took place on the Ethereum network. It is aimed at solving one of the main problems of the project – high transaction fees. The algorithm for calculating transaction fees will burn part of the fees that miners are currently receiving as a reward.
At first, the rally was really driven by Bitcoin. Because when many institutional investors came into this crypto space, they just started to get acquainted with investment opportunities. And now they realized that they can use other currencies. As the rally matured over the past six months, much of DeFi built on Ethereum, and it continues to grow.
There is growing activity on the Ethereum blockchain, including from institutional investors. Last week, the European Investment Bank announced a $ 121 million two-year digital bond offering.
Ethereum co-founder Vitalik Buterin became billionaire
After the Ethereum price surpassed the $ 3000 mark, the co-founder of the second largest cryptocurrency, Vitalik Buterin, became one of the billionaires. The cost of 365,000 ETH belonging to Buterin was $ 1.06 billion. In addition to Ethereum, Buterin “hodling” Bitcoin, Bitcoin Cash, Dogecoin and Zcash. Then they were valued at less than 10% of the value of the cryptocurrency, the second in terms of capitalization, which he kept. Also in his portfolio were KNC, MKR, OMG and REP tokens.
Recall that Buterin donated 100 ETH and 100 MKR (~ more than $ 600,000) to the fund to fight the coronavirus pandemic in India.