Last year, we predicted a faster growth in the value of Ethereum compared to Bitcoin. Now on to altcointhe general public drew attention, and its capitalization exceeded the cost of Mastercard and NVIDIA.
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Ethereum is the second largest cryptocurrency in terms of capitalization and is growing for the sixth week in a row stronger than Bitcoin. This attracts the attention of speculators and investors interested in immediate benefits.
Image Source: StormGain Cryptocurrency Exchange
However, Ethereum's strength lies not in hype, but in smart contracts, which gave impetus to the development of markets for decentralized finance and digital art.
Decentralized finance is a marketplacelending without intermediaries, where you can take a loan or place funds to generate passive income (similar to deposits). This segment of the cryptoeconomy is young but growing at a colossal rate, which is worrying even for giants like Bank of America. Over the past 12 months, the DeFi market has grown 85 times and reached a capitalization of $ 77 billion, with about 95% of contracts based on the Ethereum blockchain.
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Another example of the practical use of cryptocurrency– digital art market. Non-fungible tokens (NFTs) of the Ethereum network serve as an analogue of a digital signature or certificate. Any digital document can be assigned its own unique token, which confirms copyright, history of changes of owners, and even royalty conditions (the author’s remuneration for each resale).
The NFT market is expected to grow from $400 million this year.up to $1.5 billion, and tokens for works of digital art are already participating in such famous auctions as Christie’s and Sotheby’s. Thus, the painting by Mike Winkelmann (Beeple) went under the hammer in March for a record $69 million.
The only thing that delays the real boomEthereum - high transaction costs and network load. In February, the commission peaked at $ 38 - this is the fee for any transaction, be it a loan or the creation of an NFT.
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However, everything will change after the network moves toproof-of-stake protocol. On April 23, Vitalik Buterin, speaking at the Scaling Ethereum forum, indicated the end of 2021 as a possible date for a hard fork. The success of the event will lead to a reduction in commissions and an increase in transaction speed. Analysts at FundStrat believe that Ethereum will rise to $10,000 by the end of the year, while Bitcoin will show weaker growth, reaching $100,000.
Analytical group StormGain
