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Ethereum (ether) has bucked market trends by hitting a new all-time high on Thursday, reaching above $2,600 for the first time in its history.
Just one year ago, the cryptocurrency was trading below $200. The gains have pushed ethereum’s market cap above $300 billion, nearly one third that of bitcoin’s.
Other cryptocurrencies, including bitcoin, have seen major price drops in recent days, leading analysts to note that ethereum is “showing signs of de-coupling” from its more famous counterpart.
“While the two have traded in tandem for much of the last three years, as the cryptoasset market starts to mature, investors will be looking across the broader spectrum of assets and assessing which has the best long-term potential,” said Simon Peters, a market analyst at the online trading platform eToro.
“Bitcoin has captured the attention of millions of investors, but ethereum offers an alternative… With the widespread usage of ethereum’s network following its latest upgrade, the cryptoasset continues to offer a lot of opportunities to developers and investors.”
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Mr Peters also suggested that ethereum might appeal to investors who want to whole coins, something that would cost more than $50,000 with bitcoin.
Other market analysts attributed ethereum’s record gains to the rise of the decentralised finance (DeFi) ecosystem, which replaces traditional financial products – like lending, borrowing and saving – with versions that do not rely on a company or bank.
“We are witnessing a perfect storm for ethereum’s momentum,” Sergey Nazarov, co-founder of smart contract network Chainlink, told The Independent.
“The thousands of developers building what is now the fastest growing ecosystem in the entire blockchain ecosystem, seem to be building their applications on top of ethereum.
“Beyond DeFi, decisions to trial various use cases on ethereum by companies like Visa are likely signalling to the wider market that ethereum is probably here to stay.”
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