Where is the Ether going to take us?

The bull market is the “flag-bearer” of the bull market, as bitcoin has soared to new highs.

With the powerful ecological empire it has built, Ether is proudly standing out in the blockchain world. In recent times, its successor Bitcoin has stepped on the gas and soared, with its price reaching record highs, and the whole cryptocurrency circle has gone crazy for it.

Non-small data shows that as of 17:00 on May 9, Ether touched a high of $3,982, up as much as 433% this year, far exceeding Bitcoin’s 106% rise in the same period.

As the price of Ether continues to rise, its market capitalization has also grown significantly. According to Asset Dash data, Ether is now priced at $3,930, with a current market cap of about $455.5 billion, surpassing Johnson & Johnson in 15th place in the global asset market cap ranking.

Where is the Ether going to take us?

Ether ranks 15th in global asset market capitalization

Meanwhile, as the world’s largest bitcoin investment fund, Grayscale is seen by secondary market investors as a bellwether for crypto asset investments. Since the current bull market, its increased holdings in Ether have been increasing, and as of May 6, Grayscale claims that the total value of its crypto assets under management has reached nearly $52 billion. In addition, Grayscale currently holds more than 3 million Ether, worth more than $11 billion, according to its official Twitter feed.

Once again, Ether has become the highlight of the day, and has become the “meat and potatoes” that investors are scrambling for. Liao Wang, CEO of Atomic Chain, is even optimistic that the price of Ether is expected to exceed $5,000. However, some cautious investors say that they are already making defensive moves.

Ether stepped on the gas and soared
As the second largest crypto asset in terms of market capitalization, Ether has recently performed well in the crypto asset market, which can be described as a double gain of fame and fortune.

According to Google Trends data, from May 3 to 8, the keyword “ethereum” exceeded the level of the beginning of 2018 with a record-high search trend heat of 100 worldwide. It is worth noting that the Google trend heat score represents the search heat in a given area and at a given time compared to the highest point, and 100 means the highest heat. This shows how hot the market is.

In the big pullback from April 14 to 25, Bitcoin fell from $64,800 to $47,000, a drop of over 27%, and a slew of cottage coins declined. On the contrary, ethereum not only fell less but also reached record highs, which can be described as a combination of ice and fire.

Specifically, on April 18, ethereum started its upward attack from the low point of $1,940, and touched a maximum of $3,982 on May 9, with a maximum increase of over 105% compared with the lowest point on April 18. During the same period, Bitcoin’s lowest point occurred on April 25, at $47,000, and rose as high as $59,488 on May 9, with a maximum increase of 26%.

One industry analyst believes that the strong rise in ethereum prices was both unexpected and justified. According to Santiment data, the number of Ether giant whales has been surging since January this year, and the number of users with more than 10,000 Ether has now reached a record high. on April 26, the number of wallets holding more than 10,000 Ether reached 1,311.

“Investors have been buying Ether on the low lately.” A veteran player in the cryptocurrency circle said that Ether has successfully captured the “hearts” of a group of investors in front of the amazing rise.

Recently, NBA Dallas Mavericks owner Mark Cuban spoke at the Ethereal Virtual Summit, saying that the bear market for crypto assets is not coming and will remain on an upward trend due to the hot DeFi market. He also believes that the future potential of ethereum is greater than bitcoin because it has more application scenarios than bitcoin and the bitcoin derivatives market is too large and will be a high risk hazard when a price pullback occurs.

On April 23, Jiang Zhuoer, CEO of Lepit Mining Pool, said in his Weibo post that Bitcoin represents “monetary freedom”, while Ether represents “monetary freedom + contract freedom”. He believes that, except for economic acts involving entities, a large number of economic acts are equal to “currency + contract”, especially financial acts. From ICO to DeFi to NFT, a lot of innovations have been made in the history of ethereum, and more innovations will be made in the future. In Jiang Zhuoer’s view, “freedom of currency + freedom of contract” can be derived from everything.

However, cautious investors can’t help but feel worried: how long can such a strong performance last? Nuclear Finance APP also found that most cryptocurrency analysts in recent days are prompting to beware of pullback risks in front of the crazy market.

Ecological value identity may have been formed
“Against the backdrop of Ether continuing to set new all-time highs, it is leading a host of crypto assets to ascend to a bullish climax.” Analyst Tina said that Ether has surprised the crypto-crypto market by taking over from Bitcoin to continue its bullish surge.

It must be said that the current Ether seems to be standing in the spotlight and is too eye-catching.

A few days ago, Fred Wilson, an investor in well-known Internet companies such as Twitter and co-founder of Union Square Fund, said that the vast majority of crypto blockchain networks over the past twelve years have been mainly buy, hold, and speculate, and these actions have funded the supply side of blockchain networks, but Ether and some blockchain networks are changing the status quo, and you need Ether to do things on the ethereum network, like buying domain names, P2P finance, buying art, horse racing games, etc. like I do. The more people who buy Ether, the faster the demand side will grow and the value of Ether will increase.

However, he also cautions readers that they may also be experiencing a new wave of speculation right now, but I think the demand side has taken off for now.

Not long ago, the value of Ether was recognized in a JP Morgan report. The report said that ethereum has significantly outperformed bitcoin since early April. First, ethereum’s liquidity is more resilient. The liquidity shock in the crypto derivatives market caused a huge liquidation in which the bitcoin futures market was much more affected than the ethereum futures market, and the depth of ethereum trading recovered quickly during the market recovery phase; second, the ethereum spot turnover rate is much higher than that of bitcoin, which also means that ethereum long positions prefer to hold spot rather than futures and perpetual contracts; third, the trading activity of the ethereum network demonstrates the richness of its on-chain activity, including the growing DeFi and other areas of the ecosystem.

JPMorgan says there are significant differences between Ether and Bitcoin. Bitcoin is more of a crypto-commodity than a cryptocurrency and is tied to gold, which is a store-of-value asset. Ether, on the other hand, is the backbone of the cryptocurrency eco-economy and acts as a medium of exchange in the ecosystem.

William, the chief researcher of OKEx Research Institute, attributed the ethereum surge to two points in a media interview.

One, blockchain networks are different from ordinary networks. The cryptographic digital tokens issued by the blockchain network protocol layer are the basis for the proper operation of all distributed application usage and are used as Gas fuel fees, pledges, investment and financing, etc. Take DeFi as an example, since its outbreak in June last year, the volume of Ether lock-in for DeFi protocol has grown exponentially, and the boom of DeFi has directly driven the market demand for Ether, thus driving its price high.

It is worth mentioning that a few days ago, the Federal Reserve Bank of St. Louis published a paper that delves into the expansion of DeFi and its role in Ether. The article argues that DeFi could lead to a paradigm shift in the financial industry and may help create a more robust, open and transparent financial infrastructure.

Second, the Toronto Stock Exchange in Canada went live with three Ether ETFs in late April, providing a compliant access to capital for investors in traditional financial markets, in addition to news that the European Investment Bank will issue digital bonds on Ether. All these news are directly favorable to the rising price of Ether.

Technology evolution becomes the key factor of reversal
For Ether to get rid of Bitcoin out of the independent market, industry insiders believe that this indicates that the ecology on Ether has matured, and its own coin price has formed a resonance with the ecological development.

In front of Ether’s rocketing price, some advocates say that Ether has been in second place in terms of market capitalization for a long time, however, Ether has a more ambitious goal to become the support platform and underlying architecture for the whole crypto world, so it is possible for its market capitalization to overtake Bitcoin.

Opponent Kevin O’Leary, a Canadian businessman and TV personality, said in an interview with CNBC that despite its all-time high price, Ether will always be second to Bitcoin. ” but it is currently too expensive. He added, “Bitcoin will always be gold, and ethereum will always be silver.”

In fact, as a public blockchain platform for “cryptocurrencies and decentralized applications,” the Ether smart contract feature has dramatically changed the blockchain world by allowing anyone to build and use decentralized applications based on Ether that run through blockchain technology.

In the long run, Ether 2.0 will gradually solve transaction congestion as well as high transaction fees and deflation caused by the currency issuance mechanism. However, there is still a long way to go to fully realize the overall plan of the Ether 2.0 roadmap.

“Right now, both Ether 1.0 and Ether 2.0 beacon chains are in a parallel state, and the interaction can only be de-pledged contracts deposited 32 Ether, and as of now, there are more than over 100,000 validators, which are forming a new POS consensus.” Yao Xiang, the initiator of the Shanghai Frontier Technology Seminar an event, said that the Berlin hard fork in April introduced the new EIP, July will also usher in the London hard fork, and then down to the Shanghai hard fork. The core Ethernet team is considering merging Ether 1.0 and Ether 2.0 in the Shanghai hard fork, and is currently focused on merging Ether 1.0 and Ether 2.0.

Last month, Vitalik Buterin, the founder of ethereum, said in a speech about the switch to PoS for the ethereum consensus mechanism that the roadmap is becoming more pragmatic in many ways as the merger approaches and that the long-awaited upgrade is “optimistically estimated ” will be completed by the end of this year.

However, industry veterans generally believe that the dragging style of Ether developers is unlikely to end the POW and complete the conversion to POS by the end of the year, Wu said blockchain reports. Previously, the industry generally believed that the conversion would take place from mid to end of 2022 at the earliest.

It is worth mentioning that under the PoS consensus mechanism, the Ethernet network generates a block in 12 seconds, and the average waiting time for sending a transaction will be reduced to 6 seconds. Industry analysts believe that the PoS light client protocol is more sophisticated in design, which makes the browser’s built-in light client and the PoS light client wallet on mobile more feasible and reduces the reliance on centralized service providers.

And even earlier, Justin Drake, a researcher of Ether protocol, had introduced the concept of Ether 3.0, which would be an important plan for Ether to resist the threat of quantum computing.

It is undeniable that at present, Ether is one of the most dazzling wealth creation machines among global crypto assets, and it will take time to test whether this wealth creation myth can continue on the way to gradually realize Ether 2.0.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/where-is-the-ether-going-to-take-us/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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