Ethereum’s ETH token surpassed the psychologically significant mark of USD 3,000 per token today and rose to USD 3,003 at the time of publication on Binance. The ETH price hit the milestone on several major exchanges including Bybit, Coinbase and BitMEX.
The surge has helped Ethereum overtake institutions like The Walt Disney Company and Bank of America in terms of total market capitalization. The world’s largest smart contract-enabled Layer-One grew 24% on the week to $ 346.72 billion per tracking website, Infinite Marketcap. For comparison, Bitcoin currently has a market capitalization of $ 1.079 trillion, just below the total market capitalization of precious metal silver of $ 1.416 trillion and above the social media company Facebook of $ 923.12 billion.
The remarkable run has even sparked renewed speculation that Ethereum could “freak out” Bitcoin and overtake BTC as the world’s largest digital currency.
Multiple headwinds share responsibility for Ethereum’s rise. The first is a sustained surge in activity in the chain, including from institutional companies: earlier this week, the European Investment Bank announced it would be working with banking companies like Goldman Sachs to issue a two-year digital bond worth $ 121 million. Retail interest in DeFi has also increased lately, with the total number of blocked assets reaching astounding highs over $ 100 billion.
The hard fork “London”, which includes the revision of the fee structure of Ethereum by EIP-1559 as well as the emerging transition of ETH 2.0 to a consensus model for the proof of use, could be the most important events that investors expect. These network upgrades are expected to significantly lower fees and reduce the amount of ETH given out to miners – which in turn should ease pressure on the asset’s sell side.
David Hoffman, host of Ethereum educational media company Bankless, has equated the various initiatives with three separate “halves,” an event that happens roughly every four years and cuts the Bitcoin block subsidy by half. Halving is believed to contribute to Bitcoin’s price increase.
# The three halves of Ethereum are not priced in
– DavidHoffman.eth @ (@TrustlessState) April 22, 2021
However, Ethereum has some competition in the form of other intelligent, contractable layer-one chains. Ethereum’s growing popularity is due in part to exorbitant transaction fees in the chain (although these have decreased somewhat in recent weeks), and in the absence of viable Layer 2 scaling solutions like rollups, several competitor chains have seen spikes in activity.