Spencer Noon, the head of crypto investments at DTC Capital, says real-world use of Ethereum is surging.
Noon points to the increasing popularity of stablecoins and the rise of decentralized finance (DeFi) as two key factors that are boosting the network and driving demand for the cryptocurrency ETH.
“There is a growing link between Ethereum utility and ETH demand. ETH miners have captured $3.5M in fees over the past 30 days.
Below we can see that the demand for blockspace is mostly driven by stablecoins and DeFi, which together account for >63% of fees paid.”
The number of daily transactions on the Ethereum network has soared in 2020, rising from 466,000 on January 1st to 855,000 on May 20th, according to BitInfoCharts.
Institutional interest in the second-largest cryptocurrency also appears to be on the rise. The digital asset management giant Grayscale reported a record $110 million in first-quarter inflows into its Grayscale Ethereum Trust. Noon says the numbers show Ethereum is officially on the radar for high-net-worth investors.
“Institutional investors are buying ETH. The cat is officially out of the bag. From the latest Grayscale report: [Grayscale] Ethereum Trust saw $110M in Q1 inflows.
This is more than all of its previous inflows combined for the past 2 years ($95.8M).”
The price of ETH began the year at $131.88 and is now at $195.63 at time of publishing, according to CoinMarketCap. That’s a 48.33% increase.
Bitcoin (BTC), which has dropped 5% in the last 24 hours, opened 2020 at $7,200 and is now at $8,990 – a 24.86% increase.