Ether, the world’s second largest cryptocurrency and blockchain currency Ethereum, just broke its all-time highs above $ 4,400, but it still packs more bullish surprises.
Ether’s new record came amid growing market concern about inflation, forcing investors to seek alternative havens unlinked from conventional currencies.
In addition, the rise of decentralized finance was driven by the belief of analysts that the Ethereum network will be essential for the development of the metaverse, the new digital revolution in which the technology sector is immersed.
Ethereum resurfaces after China’s ban on the back of the metaverse
Ether’s new push to its all-time highs is important, especially since the currency plunged in late September following China’s ban on outlawing crypto asset trading.
However, the recent update of the Ethereum network to a system that introduced “proof of stake” instead of “proof of work” in mining operations, revitalized the listing.
Now, the network will be much more used to create decentralized applications (dapps) and transact with non-fungible tokens (NFT).
“The reason ether reached all-time highs is due to the recent update of the Ethereum network system as proof of stake, plus it is the blockchain of choice for non-fungible tokens and metaverse projects,” he said. Wildred Daye, director of Securitize Capital.
Ethereum stands as the center of all metaverses
The metaverse is a phenomenon that consists of creating virtual environments, similar to the one that was Second Life. But the difference is that in the new metaverse there are a series of digital assets that can be exchanged, specifically NFT assets (non-fungible tokens).
These assets represent digital properties or objects that are created primarily on the Ethereum network.
Although there are different networks to do the same (like Solana O Avalanche), all of them are connected to Ethereum and use it as an intermediate point, that is, to move assets from one site to another.
Thus, “Ethereum has been orchestrated as the center of everything,” he said. Alberto Toribio, ambassador of cryptoplaza. This network and its currency is the element of exchange between all metaverses. In addition, to enter them, you have to do it through Ethereum.
For these reasons, what the market is discounting is “the future success of Ethereum” as an exchange network between the different metaverses, said Toribio.
Inflation, another bullish catalyst
To all these factors, Wildred Daye added fear of inflation to the list of factors that drove the price of ether.
“Inflation is an important consideration and the younger generation of investors often favor cryptocurrency as a hedge over gold,” Daye said.
In his view, these are not only retail investors but also institutional investors, who are increasingly looking towards digital currencies to hedge their portfolios against rising prices.
More bullish margin for ether
After the last push of the ether, analysts consider that there is still more room to rise.
For example, Daye sees ether likely to continue to rise in the final stretch of the year, facing its greatest resistance around $ 4,900.
Other cryptocurrencies linked to the ecosystem of decentralized finance, such as Solana or Cardano, also experienced strong advances.
All the factors mentioned, together with the high use of the network and the technological update, are the factors that drove the price of these crypto assets, according to the sources consulted.