In early trading Thursday in the Asian session, the Ethereum price It reached a new high of $ 1,750, marking a 9% gain on the day. ETH is now 17% higher than its previous all-time high three years ago and could go further if the momentum continues.
It has positioned the asset firmly above its previous and 2018 high of $ 1,450 as it moves ever closer to the $ 2,000 level. Since the beginning of the year, the price of ETH has risen a whopping 130%. In comparison, Bitcoin has gained only 30% during the same period.
At press time, Ethereum had retreated slightly and was trading at $ 1,665 according to Binance. The momentum is likely fueled by Ethereum futures which will debut on the Chicago Mercantile Exchange on February 8.
Ethereum at $ 20,000?
As with any crypto asset reaching a new all-time high, longer-term price predictions are starting to emerge and there has been a huge one from Global Macro Investor economist and CEO Raoul Pal. Investment strategist sees big things for Ethereum with a bold $ 20,000 price prediction;
"I still hope it reaches $ 20,000 by the turn of the year."
ETH is up 126% YTD. Its Feb 3rd, FFS! I still expect it to hit $ 20k by around the turn of the year.
The entire DA space is going to consume the performance of everything else, with BTC as the flag carrier as The Big Asset. It is up 30% YTD hugely beating every other major asset
– Raoul Pal (@RaoulGMI) February 4, 2021
$ 20k maybe a little on the bullish side, but the ETH price they could easily hit $ 5k when the ETH 2.0 scale is rolled out with Phase 1 of the Serenity update.
At current prices, around $ 4.9 billion in ETH has currently been locked into the Beacon Chain contract, immobile for at least a year. There are almost 3 million ETH wagered now that will not be available to investors until Phase 1.5 merges the two blockchains.
The gas crisis worsens
Scaling up has been a major thorn in the side of the world's largest smart contract network, which is crumbling under pressure right now. Ethereum transaction prices have skyrocketed to their highest levels of nearly $ 20.
Basically, this has made micro-transaction DeFi are unsustainable, as moving just under $ 1,000 in ERC-20 tokens is going to hurt. Industry Expert Anthony Sassano commented on the increase in the volume of DEX for ETH that is aggravating the demand in the network;
"Decentralized exchange volume on Ethereum was $ 63 billion in January, breaking the September 2020 all-time high of $ 29 billion."
DeFi farmers are currently switching to Layer 2 exchanges like Loopring or alternative chains like NEO's Flamingo Finance and Binance Smart Chain, both of which have seen an increase in volume recently.