Then play music and dance, two factors push ETH to break through $2,000

This article comes fromDecrypt, original author: Jeff Benson

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Then play music, then dance.

In fact, the rise of Ethereum this time is mainly driven by two factors.

First, institutional investors and retail investors have surged in Bitcoin investment, and more and more people have begun to understand cryptocurrencies and have great interest in investing in cryptocurrencies. Since the beginning of the year, the bitcoin price has soared from $32,000 to over $57,000.

Even after the price of Bitcoin continued to break through its all-time highs, Ethereum seemed not to be outdone. On February 20, 2021, as the second largest cryptocurrency in the world by market value, the price of ETH broke through 2,000 USDT, hitting a record high and increasing by 168% since the beginning of the year.

In fact, the rise of Ethereum this time is mainly driven by two factors.

First, institutional investors and retail investors have surged in Bitcoin investment, and more and more people have begun to understand cryptocurrencies and have great interest in investing in cryptocurrencies. Since the beginning of the year, the bitcoin price has soared from $32,000 to over $57,000.

Second, decentralized finance (DeFi) is booming, and many DeFi projects are running on the Ethereum blockchain. In the past few years, the market has been looking for a "killer app", and now DeFi is the best answer. Decentralized financial services allow people to borrow money, accumulate interest, and exchange assets without going through a financial institution. According to DeFi Pulse data, there are currently more than 70 Ethereum-based DeFi applications, and the total lock-up value of these applications has exceeded 42 billion US dollars. In addition, among the top 50 Ethereum-based projects, only two non-stablecoin projects have suffered losses (ERC-20 HEX and Compound Dai), while the others have shown an upward trend, and 34 projects have seen price increases of more than one times.

Paul Veradittakit, a partner at cryptocurrency venture capital firm Pantera Capital, said:

"ETH breaking $2,000 is a testament to Ethereum scalability, accelerated growth around DeFi and NFT applications, proof that Ethereum remains a market leader in creating decentralized applications, all of which ultimately make Ethereum a Institutional-grade asset class.”

At the time of writing, according to Asset Dash data, the market value of Ethereum has risen to the 34th place in global assets, currently about 232.808 billion US dollars, an increase of 5.67%, a single-day increase of 9 places, and has surpassed Adobe, Pinduoduo, Salesforce, Nike , Coca-Cola, Cisco, Pfizer and many other well-known enterprises. Indeed, in terms of institutional-grade assets, investors have access to more Ethereum-based financial instruments, such as the Grayscale Ethereum Trust in the United States and the 3iQ Ethereum Fund on the Toronto Stock Exchange.

Jordan Spence, chief marketing officer of wallet management tool MyCrypto, believes that the rise in ETH prices is caused by a combination of factors, he explained: