Ethereum, the second-largest cryptocurrency by market cap, today hit a peak of $316, its highest price since July 2019. The current price of Ethereum is $308, according to data from metrics site CoinMarketCap.
The pump started way back on Wednesday night (UTC), when Ethereum, in about ten minutes, rose from $245 to $262. But no dump followed. Instead, on Thursday afternoon, it increased once again, from $265 to $277. Then an upward crawl, reaching $285 by Saturday afternoon.
And then came the latest boom. Between Saturday evening and Sunday morning, Ethereum rose by ten percent, from $285 to $316.
Ethereum was joined in its success by elder sibling Bitcoin, the oldest cryptocurrency and the largest by market capitalization. Bitcoin surpassed $10,000 for a few moments on Sunday morning, the first time it’s done so since the beginning of June, bucking almost two months of near-stagnation.
Ethereum’s price increase likely has something to do with the rise of DeFi, or decentralized finance. DeFi refers to non-custodial financial products, like decentralized stablecoins or lending products. Most DeFi protocols live on Ethereum.
DeFi is a massively expanding industry. Yesterday, Decrypt reported that there was $4 billion locked in DeFi smart contracts. That’s a lot, but consider the growth: on Tuesday, $3 billion was locked in DeFi protocols. About two and a half weeks ago, on July 7, it hit $2 billion.
DeFi has been rapidly expanding ever since the trend of yield farming. The trend, which started in mid-June, involves users earning token incentives from DeFi lending protocols in exchange for depositing their cryptocurrency.
Tokens from the top DeFi lending protocols, $LEND (from Aave) and $COMP (from Compound), have spiked in value. (Granted, $COMP was only introduced on June 18, but quickly increased from $80 to $319 within a week, before settling at about $161.)
What’s good for DeFi, clearly, is good for Ethereum.