Ethereum, or ether for short, reached a fresh all-time peak of just over $2,900 on Saturday. In 2021, ether prices nearly quadrupled, rising 290 percent. Bitcoin has also had a fantastic year, more than doubling in value.
According to CoinMarketCap, the cumulative volume of all Ethereum in existence is now about $333 billion. The market capitalization of Bitcoin (XBT) is about $1.1 trillion.
The 2021 Bull Run Continues
Despite the fact that there are thousands of coins, including the Elon Musk-inspired Dogecoin, Bitcoin and ether account for approximately two-thirds of the $2.2 trillion global crypto sector.
Bitcoin’s price has surged this year, thanks in part to expanded business acceptance. Tesla (TSLA) ran by Elon Musk, has purchased bitcoin to keep on its balance sheets. Square (SQ) and PayPal (PYPL), two of the world’s largest digital payment companies, are now allowing people to purchase, sell, and retain cryptocurrency.
However, Ethereum has risen much faster than Bitcoin. This may be linked to the fact that it is the preferred cryptocurrency for purchasing several non-fungible tokens, or NFTs, which have swept the art and collectibles landscape.
The rise of Ethereum is also tied to the advent of decentralized finance technologies.
What is Decentralized Finance?
Decentralized finance, or DeFi, is the use of bitcoin and blockchain technology to manage financial transactions.
DeFi seeks to democratize finance by replacing legacy, institutional institutions with peer-to-peer relationships that can include a wide range of financial services, including traditional lending, leasing, and mortgages, as well as dynamic contractual and asset sharing partnerships.
Today, centralized, controlling, and gate-keeping systems control nearly any aspect of the banking, funding, and trading industries. Customers must deal with a variety of financial intermediaries on a daily basis, from vehicle allowances to loans to stock and bond sales.
As a result, customers’ direct access to capital and financial services is restricted. They are unable to exclude intermediaries, such as insurers, traders, and creditors, that profit from every financial market trade.
Decentralized finance eliminates traditional financial instruments such as brokerages, trade, and banking that rely on central financial intermediaries; instead, smart contracts are used on blockchains, the most common of which is Ethereum.