Ethereum is on the rise again.
The overall market conditions have not changed a great deal of late, but ETH began its outperformance and dominance in mid-April of this year. The traded volume has consistently increased while nearing the April expiry, and still remains very high. The most prominent space is Defi (Decentralized Finance), which refers to the shift from traditional, centralised financial systems to peer-to-peer finance enabled by the Ethereum blockchain.
One of the primary benefits of DeFi on Ethereum is that financial activity is transparent and settles in real time. Since the beginning of 2021, the number of unique Ethereum addresses has risen to approx. 146 million (+ 12%), and DeFi users only represent about 1% of the total Ethereum addresses.
While all of this growth has been incredibly beneficial for the entire crypto ecosystem, it presented some challenges to the network. The gas price has increased by 50%, as did the price of Ethereum, and at the end of Q1 2021, this meant an average transaction fee of $23. Ethereum’s total fees were double that of the Bitcoin blockchain.
There is still huge potential to continue increasing the number of transactions, speed, efficiency, and scalability of the network, e.g. Ethereum 2.0 and EIP 1559 standards.