As crypto traders, we have all been so caught up in the bitcoin hype as of late that it appears we have forgotten about Ethereum and a lot of the world’s smaller altcoins, but the fact is that these assets should not be forgotten. In fact, they should be revered.
Ethereum Is Surging
Ethereum has recently hit a new all-time high. At the time of writing, one unit of Ethereum has struck $2,774. That means one unit of the world’s second-largest cryptocurrency by market cap is now trading for just under $3,000. Not bad for an asset that just a few months ago was worth only a few hundred dollars. By contrast, bitcoin – which has been struggling as of late – has fallen to about $53,000 per unit. This is roughly $2,000 less than where it stood roughly 48 hours ago.
Ethereum appears to have struck new territory following an announcement from the European Investment Bank. The institution stated that it had moved its first digital bond onto the Ethereum network, which led many traders and analysts to believe that banks and standard monetary firms are now beginning to transition to the world of crypto.
Carol Alexander – a professor at the University of Sussex Business School – explained in an interview:
There is just so much hype from the institutions coming in. Bitcoin is almost like a sort of reference point, the numeraire of crypto. I think there is going to be sustained demand as institutional investors become more confident about the market. Having said that, on the more retail side that used to be in bitcoin, it is not cool, anymore. Everyone knows about bitcoin and we want things to talk about. We do not want to talk about COVID all the time. So much of this is about psychology. We have been shut inside and have not had any news to talk about.
Ethereum has grown extremely popular over the years for several reasons, a big one being its smart contract capabilities. It is the most popular network for building new cryptocurrencies and decentralized applications (dapps), though this has come with something of a downside and led to scalability issues according to co-founder Vitalik Buterin, who has since initiated the release of Ethereum 2.0 to solve some of the problems that have been hitting the network over the past few years.
More Growth in the Coming Days?
Simon Peters of e-Toro fame says:
Post the network upgrade, Ethereum is proving its use-case, and with developers piling onto the platform, it is little wonder it is gaining so much traction with investors. Underlying this is demand from institutional investors. While they may now have some exposure to bitcoin, institutions are now diversifying their exposure and Ethereum is the natural next pick, and that leaves the second biggest crypto asset by market cap well placed to benefit further.