3 Reasons Why Ethereum Price Jumped 75% to 2-Year High

Editor's Note: This article comes fromCointelegraph Chinese (ID: CointelegraphChina), Author: JOSEPH YOUNG, reprinted with authorization by Odaily.

Editor's Note: This article comes fromETHCointelegraph Chinese (ID: CointelegraphChina)BTC, Author: JOSEPH YOUNG, reprinted with authorization by Odaily.

Over the past two weeks, Ethereum (

)rise.

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ETH-USD daily chart Source: aicoinThree factors appear to be triggering a strong rise in Ethereum: DeFi, Ethereum 2.0, and the current prolonged rally in the altcoin market.secondary titleCOMPDeFi growth is driving altcoins higher, but there are bearish signs

Since mid-June, decentralized finance (DeFi)

The total value locked in the protocol continues to soar

, resulting in growing demand for DeFi.express：

The explosive growth of the DeFi market in a short period of time has caused many DeFi-related tokens to skyrocket rapidly. In July, investors appeared to dump DeFi tokens and other smaller altcoins in favor of Ethereum and Bitcoin.

The price of ethereum hit a 2-year high today, surging to $395 on BitMEX, but traders warned that a pullback could be in the offing. In fact, cryptocurrency trader Edward Morra

express"Yes, the upside is unsustainable and will correct. If you're new to the space, buy the dips and don't buy the tops for fear of missing out."。

secondary title

One ongoing positive factor supporting Ethereum's gains is the anticipation of Ethereum 2.0. In August, Ethereum developers expect toexpress：

When Ethereum 2.0 is fully launched, miners will be gradually eliminated from the network and users who participate in the network will be rewarded. Incentives will enable users to earn benefits from their long-term holdings of Ethereum.

Kelvin Koh, co-founder of venture capital firm Spartan Black, recently said that every phase of Ethereum will boost Ethereum. Koh

express

"Over the next 2-3 years, each phase of Ethereum 2.0 will bring Ethereum closer to its final state and will serve as a catalyst for Ethereum."

secondary title

Over the past three days, gains in Ethereum and Bitcoin have coincided with declines in altcoin prices. In the short-term, the cycle of profit-taking could continue if altcoins see a regular uptrend.

In previous bull markets, the prices of major cryptocurrencies and smaller altcoins have had an inverse relationship, meaning that as the price of Bitcoin surges, the price of altcoins falls.

The opposite is true when the Bitcoin price is stable or consolidating. This created a cycle that allowed Ethereum and Bitcoin to benefit from multiple profit-taking altcoins.