The rate renewed its all-time high (ATH) during the Asian trading session on Monday, January 25. The second largest cryptocurrency came close to the $ 1500 mark
Over the course of the day, Ethereum has risen in price by 13% and entered the growth leaders among the ten largest coins. ETH has set a new high at $ 1,480, according to Tradingview.com.
Since the beginning of 2021, the ETH rate has doubled, and over the past 12 months, the growth has been 800%. At the time of writing, ETH is trading at $ 1,440. Despite pulling back from the highs, the coin remains bullish.
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The event did not go unnoticed in the industry.
Head of OKEx Cryptocurrency Exchange Jay Hao notedthat second-tier solutions could be the driving force for Ethereum;
“ETH has updated ATH again. The Ethereum universe is expanding rapidly with the big bang in DeFi and tier 2 solutions that work. It is time for industry participants to start thinking about how to navigate this new universe. I bet on high performance and blockchain interoperability. “
The race for profits
Industry observer Lark Davis noted that Ethereum volume on centralized exchanges has dropped to its lowest level in the past fifteen months. This is usually a good sign. Traders are not going to sell coins and withdraw them to wallets for long-term storage.
However, this time investors are withdrawing Ethereum from exchanges not only to cold wallets. A significant portion of the coins go into ETH 2.0 staking and decentralized finance (DeFi) protocols.
Read also: How Ethereum grew: a review of previous rallies
According to ETH 2.0 Launchpad, 2.82 million ETH is blocked in the Beacon Chain contract. At the current exchange rate, this is about $ 4 billion. The annual percentage rate of return in ETH for staking participants is currently around 9.3%.
DeFi has about 7 million ETH blocked. This is evidenced by the data from DeFi Pulse. Thus, 8.6% of the current issue was actually withdrawn from circulation. As in the case of Bitcoin, investors are determined to keep the coin, and not speculate with it in order to make money quickly.
Other criteria, such as the number of searches on Google or the difficulty of mining, have also reached new heights.
Gas prices continue to rise
Along with the rise in the cost of ETH, the average cost of transactions on the network also increased. According to bitinfocharts.com, gas prices have reached $ 9.30. The maximum was recorded on January 11 at $ 16. Despite the correction, gas is likely to continue to rise in price this year.
The increase in value so far covers any transaction costs, since everyone who bought Ethereum earlier is in profit. Yet the relevance of deploying cost-effective solutions such as EIP 1559 is greater than ever.
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