By Shelly Melancon (Switzerland)
As of May, Ether was outpacing Bitcoin and was on its path to a record milestone. This is the first time since May that Ether has surpassed $4,000. In the previous week, Ether, the world’s second-renowned digital currency by valuation, has risen roughly 20 percent, as opposed to Bitcoin’s 2% increase. After a roughly 60 percent sell-off on May 12, analytical indicators show that ETH is ready to go upward towards its all-time high at USD 4,300.
ETH/USD Price Chart. Source: Tradingview.com
During the London hard split, which took place in August, Ethereum’s blockchain received a much-anticipated update. Due to the price increase, the ETH/BTC ratio rose beyond 0.07, and the price broke through $2,900.
Other factors contributing to the price increase of ETH include the return of non-fungible token (NFT) operations, as well as the demand in output-generating decentralized finance (DeFi). As a result, the amount of ETH coins trapped in DeFi is increasing. According to Simon Peters, the virtual asset expert at the multi-asset investing platform eToro, “this is increasing the supply of the digital tokens since more tokens are effectively inaccessible to the system for trade.”
“Ethereum stakes are increasing. This means that just around 6 percent of the tokens are available,” Peters stated. Because of this, Ether’s valuation has risen to $471 billion, a 5 times gain in the past year.
Digital Currencies’ Prices are Surging
ETH, the primary asset of the Ethereum network, surpassed a crucial major hurdle of $4,000 on Friday, as Bitcoin surged for a fourth consecutive day to over $50,000, its highest point in approximately three months.
According to a study released Friday, U.S. employment growth was weak in August, giving Bitcoin, the leading digital currency by sales volume, a boost. As a result of the statement, there were predictions that the Federal Reserve would extend its bond-buying program of $120 billion a month for a wider period than stated.
Bitcoin and similar digital currencies are expected to gain prominence as the U.S. central bank’s accommodating financial authorities reduce yields on conventional marketing assets such as bonds, stocks, and securities.
BTC/USD Chart. Source: Tradingview.com
As of the time of writing, Bitcoin was trading at about $50,700, from $50,940 on Friday. However, it’s still a long way off from the record volume of over $65,000 that was set in April. As of Friday, Ether had risen by 4.9 percent, breaking above $4,000. The market value spiked to $4,025 before falling to $3,970 as of the time of writing.
Perhaps owing to the rise of non-fungible token (NFT) activity, there is more Ether being traded than Bitcoin. In a blog post, Glassnode wrote: “This isn’t surprising, given that the Ethereum community is generating an array of on-chain locations for ETH beyond the limits of trading platforms.”
For the past several months, cryptocurrency investors have used their ETH to purchase NFTs and yield-generating decentralized finance (DeFi) tokens. Since there are few motivations for placing the funds beyond the centralized platforms or storage facilities,” Glassnode stated, “Bitcoin on platforms stays essentially stagnant.”
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