Ether is the foundation of the affiliated Ethereum Network, the dominant blockchain used for thousands of decentralized applications.
By Bloomberg
Published in October 29, 2021
Ether, the second largest cryptocurrency, soared to a record above $ 4,400 on Friday due to bullish sentiment surrounding the most widely used blockchain network.
The digital asset gained as much as 4.8% to $ 4,459.20, beating the previous record of $ 4,379.62 in May. The token was trading around $ 4,387 as of 2:41 p.m. in New York. Other tokens, including Binance Coin and Solana, were recovered. Ether is now worth more than $ 520 billion, according to data from CoinGecko.com.
Ether's latest milestone comes as the digital token has far surpassed Bitcoin throughout this year with a six-fold surge amid growing interest from retail and institutional investors in the space.
Ether is the foundation of the affiliated Ethereum Network, the dominant blockchain used for thousands of decentralized applications. The system received an additional boost this week after a successful upgrade designed to make it faster and more energy efficient.
Outstanding futures in Ether soared to $ 12.5 billion, surpassing the May peak to hit a new high, Bybt data shows. As with Bitcoin, funding fees, or the cost of holding a bullish bet open, have increased this month on online exchanges. At CME, the futures curve has also been pronounced in a sign of optimism about the price trajectory.
"On-chain activity metrics for Ethereum appear to have found support and are reaching multi-month highs," Sean Farrell and Will McEvoy, digital asset strategists at Fundstrat said in a report Thursday. Measures including transaction rate, new addresses and active addresses have shown strong growth this month after suffering declines in May, strategists said.
Meanwhile, some analysts pointed to a connection between the rise of the super popular Shiba Inu coin and the record-breaking Ether.
Ethereum's EIP 1559 update was rolled out in August, and this burns a portion of the fees paid to miners, reducing net issuance based on network usage, said Sam Doctor, chief strategy officer and head of research at BitOoda, a regulated crypto brokerage.
"So if Shiba Inu generates a lot of traffic, it increases network congestion and contributes to more ETH being burned," he said. โThat slows the net growth of ETH in circulation. A tighter supply of ETH combined with high network usage likely pushed the price of Ether up. "
Bitcoin surged 40% this month to hit a record high of nearly $ 67,000 following the debut of the first Bitcoin-linked exchange-traded fund in the U.S. The world's largest digital currency was up 1.6% in trading New York at $ 62,405.
