Ethereum, the host of the second most popular cryptocurrency, ether, traded in at just $150 in 2020. However, in the last year, it has experienced a huge boom and it has now hit a new all-time high value of $2,150. This is partly due to its growing popularity with retail and institutional investors and in part thanks to Visa’s recent move, which now allows cryptocurrency transactions on its platform.
In February 2021, the second most popular cryptocurrency hit a record high, but this was followed very quickly by a dramatic fall when investors became more cautious. However, it rose again partly due to the sale of a painting by Beeple for $50 million as a non-fungible token (NFT).
Visa Embraces Virtual Currency
With more investors and traders looking to buy Bitcoin and other cryptocurrencies, Visa has now declared that it would start accepting the USD Coin for trades. This is a clear statement that the mainstream financial institutions are taking steps towards accepting and making use of virtual currencies, which will likely expand in future.
USD Coin is a cryptocurrency that has its value attached to an outside physical asset, such as gold. This can run on the Ethereum network. This is groundbreaking for the crypto sector as this is the first time a mainstream payment firm has allowed a virtual currency for payments.
A Sharp Incline
As a result of this, cryptocurrency experts believe that Ethereum looks set to keep on the sharp upward trajectory and say that this impressive growth is nothing short of remarkable. Aside from Visa’s recent move, the fact that Ether is used in decentralised finance applications and deposit contracts is another factor in its ever-growing industry status. Because this reduces the supply, and Visa’s announcement increases the demand, the value is driven up.
There are plenty of factors all at play right now, and all of them suggest that this looks set to be a very good year for Ethereum.
A Trillion Dollar Industry
At this moment in time, Ethereum is just part of the success story of the cryptocurrency market capitalisation, which has now just hit the $2 trillion figure -the highest it has ever been. It has doubled in value in just two months and is still on the rise.
As it stands, Bitcoin is still the biggest contributor, currently contributing $1.1 trillion to the market valuation. Although it has suffered a slight drop in the last month, it is still hovering around the $60,000 mark.
However, now the industry has grown far beyond the likes of Bitcoin and Ether and more blockchain-based applications and cryptocurrencies are being introduced.
Because of the growth in markets, the acceptance from mainstream financial institutions and the fact that Bitcoin has held its $1 trillion market cap for more than one week, confidence in cryptocurrencies is growing. As confidence grows, the markets will continue to grow and this will mean that we can expect more mainstream financial institutions to embrace cryptocurrencies.