The price of Bitcoin is consolidating as the value of Ethereum skyrocketing to all-time high
According to CoinMarketRate, the Ethereum`s network own cryptocurrency, ETH, has finally surpassed its historical high and yesterday reached a peak of $ 1,432.
ETN has broken its historical high
Ether rose by nearly 12% on Tuesday, reaching a new price peak, with hints of a coming rally predicted by analysts earlier this month. Since then, the price of Ethereum has fallen and is now around $ 1,358.
Meanwhile, BTC underwent a huge correction last week from about $ 40,000 to $ 30,000. The Bitcoin price has started to move sideways and it is currently trading at around $ 35,000.
Due to the fact that in 2020 there was a huge surge in interest in decentralized finance (DeFi)projects that are mainly hosted on the Ethereum blockchain, Brian Norton, chief operating officer of MyEtherWallet (MEW), the leading Ethereum wallet interface, believes that this surge is a positive indicator for the future of ETH, despite recent criticism of high prices for Gaz on the network.
Norton said:
“In 2020, there was an explosive growth of the DeFi ecosystem on Ethereum: in February, the total blocked value reached $ 1 billion for the first time, and now in just 11 months – $ 20.5 billion. This growth has attracted many new users who are looking for revenue that is not available for Bitcoin with centralized intermediaries.”
In 2020, Ethereum also began the transition to the Ethereum 2.0 update, which is designed to improve scalability and security, as well as move from the Proof-of-Work (PoW) consensus algorithm to the Proof-of-Stake (PoS) algorithm.
Ethereum 2.0 has been divided into phases, with phase 0 enabling the project’s staking feature. Phase 1 includes data segmentation, which will increase scalability and storage capabilities on the network. Phase 2 involves thousands of transactions per second, as well as transaction segmentation.
As the DeFi market continues to attract developers to the Ethereum network, the upgrade to Eth 2.0 is expected to help cope with the growing demands on its network.
Norton added
“What I observe is the activity of Ether developers, as it serves as an indicator that new and better use cases are emerging and this will increase the demand for their own asset. Ethereum has more than 5 times more active developers than Bitcoin, and they are being added faster and faster.”
Making comment on this, Paolo Ardoino, CTO of Bitfinex added:
“The price of Ethereum is rising in the resurgent space of decentralized finance. While the rapid growth of projects in Defi has caused growing challenges for Ethereum, multi-level solutions are currently being developed to help the network scale.”
Bitcoin is Still Optimistic and in Good Hands
While the price of Ether lagged behind Bitcoin, which hit new record highs almost weekly before last week’s correction, in 2021, ETH actually overtook the leading cryptocurrency with a gain of 92%. Meanwhile, the price of BTC has increased by 27% this year.
Despite Bitcoin’s continued consolidation around $ 30,000-Ardoino said the rise of Ethereum does not mean that Bitcoin has completed its own price rally:
“The sentiment around Bitcoin remains overwhelmingly optimistic. Bitcoin provides a solid foundation for a staggering array of projects, some of which will dramatically change the nature of money by the end of the decade. Those who celebrate the rise of competing networks in the rampant, bull market of cryptocurrencies should remember that they owe everything to Bitcoin.”
The cryptocurrency market is alive and well after a three-year bear market, when the bulls firmly took control. While the Bitcoin price is moving sideways, analysts expect $ 30,000 to become a new support base for BTC due to the massive movement of institutional investors.