El Salvador President Nayib Bukele took a victory lap on Monday after the Bank of England’s British pound rapidly depreciated against the dollar. The institution has since resumed quantitative easing. Its action marks a clear pivot that many in the Bitcoin community predicted central banks would be forced into months in advance. Bukele’s Callout Bukele tagged the Bank of England with a triumphant “Told you,” over Twitter, scoring over 14,000 like and 2000 retweets from his followers. His brief comment…
According to the 2020 CoinGecko yearly report, bitcoin’s smaller brother ETH has been the standout performing crypto of the past year.
The report delved deep into what has been an exciting journey for the crypto space over the past 12 months; the period was marked by major events such as a resurgent decentralized finance space and massive adoption of BTC by institutions part of their hedging strategies.
BTC may have grabbed the headlines in 2020 with its explosive run and gains of over 300%, but that growth pales alongside Ethereum’s performance, which clocked up gains of 472% in the past year.
CoinGecko recently shared a chart showing how ETH outperformed the top 5 cryptocurrencies in terms of market dominance. BTC comes in second with gains of 303%. Interestingly, Polkadot (DOT), a newcomer in the crypto space launched in August of 2020, made the top 5 list with a 219% growth rate.
The report also highlights the steady growth of the entire crypto sector, which ended the year with a record market cap of $732 billion.
What Could Be Behind Ether’s Stellar Performance?
Ether rallied from $130 to $600 in 2020, a year when the project came back to life. ETH has since gone on to surpass the $1100 mark for the first time since January 2018.
Among the key drivers of this growth is ETH price market speculation surrounding the ETH 2.0 upgrade. Investors are excited about the successful launch of the long-awaited upgrade that will see the Ethereum ecosystem migrate to a proof-of-stake blockchain.
Ethereum 2.0 kicked off phase 0 of the upgrade on Dec 1, coinciding with a surge in the number of active accounts on the network. Since then, active addresses have been trending upwards but are yet to hit the peak of 714,225 seen during the 2018 bubble market.
Developers are currently bringing in validators onto the network with the aim of onboarding at least 262,144 validators to secure ETH 2.0 before advancing to the next phase.
ETH Rise Catalyzed by Development of Smart Contracts
Unlike the BTC network, Ethereum’s model allows for smart contracts to be integrated into its blockchain. These smart contracts have found numerous use cases in areas of logistics and supply chains.
They are also the backbone of the growing DeFi space, enabling transactions between two individuals without the need for an intermediary.
Over the past year, the total amount of ETH transferred by smart contracts has doubled from its previous record high set in 2016. This stat is extremely bullish, as it points to the growing use case of Ethereum as a Dapp platform rather than as a network for transfers of value.
The Ethereum ecosystem is set to see an increase in real user activity and adoption in the coming months, and its native token, Ether, could well outperform BTC again in 2021.