Ethereum, the world’s second-largest cryptocurrency by market capitalization, has hit $4,000 for the first time since May 14. Its current price is just over $4,000, an increase of 4% in the past week.
The latest bull run is the result of a second wind for non-fungible tokens (NFTs), DeFi protocols and the United States’ first Bitcoin futures ETF.
Bitcoin, the largest cryptocurrency by market cap, rose by 3.7% in the past 24 hours to hit a new all-time high of over $65,000 after the first Bitcoin futures exchange-traded fund, ProShares, began trading earlier this week, letting investors gain exposure to Bitcoin without buying it directly.
The news has helped to boost the wider cryptocurrency market, with the total market cap of all cryptocurrencies reaching a new all-time high of over $2.6 trillion.
Today, the price of Ethereum stands at its highest since May, around the same time that Bitcoin hit its previous all-time high of $64,804.
To reach its previous all-time high, Ethereum doubled in price in less than a month, but the price plunged as quickly as it had surged. By May 23, Ethereum was back down to $2,110. The coin then spent several months bouncing between $2,000 and $3,000 before finally breaking through $3,000 in early August.
The growing popularity of both NFTs and decentralized finance (DeFi) have helped Ethereum to reassert market dominance. Ethereum is the first and most popular blockchain to utilize smart contracts, or self-executing code.
Through smart contracts, a wealth of decentralized finance apps have been built atop Ethereum that bypass the need for centralized institutions such as banks. The total value locked (TVL) in DeFi apps has increased rapidly over the course of 2021, and a recent surge during October has seen TVL near its all-time high of $99 billion, according to DeFi Pulse.
Ethereum-based NFTs, cryptographically unique tokens that can be used to prove ownership over digital content, have proved particularly popular with artists and creators. Big players are starting to take notice, with auction house Sotheby's launching its own Metaverse marketplace, and 1.4 million users signing up for crypto exchange Coinbase's NFT platform. In recent months NFTs have also taken on a social dimension, with collections such as CryptoPunks and Bored Ape Yacht Club forming the nucleus of new communities based around NFTs. Just last month, Sotheby’s auctioned a collection of cartoon ape profile picture NFTs called Bored Ape Yacht Club for an easy $24 million.
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