ETH price has risen above $ 2,000 with strong momentum while BTC has only risen slightly over the past 24 hours.
The hype revolves around ETH CME futures
ETH hit the $ 2,000 mark for the first time after launching a CME ETH futures contract earlier this month, primarily targeting institutional investors.
Prior to listing, it was widespread information that listing on CME would cause ETH’s price to drop significantly, as listing of Bitcoin CME futures in 2017 coincided with the local BTC peak at the time.
However, ETH has been steadily bullish since then, surpassing its all-time high and $ 2,000 on Feb. 20. The new milestone shows that there is currently significant institutional hype surrounding ETH. This is also demonstrated by the Ethereum Trust of Grayscale continuing to buy ETH in February.
DeFi’s explosive growth
According to data from Dappradar.com, the total locked-out value (TVL) of the DeFi market is close to $ 50 billion.
The term TVL is used to measure the amount of capital locked in all DeFi protocols. For example, if $ 2 billion is being used on a loan protocol for borrowing or lending, it means the protocol’s TVL will be $ 2 billion.
ETH benefits directly from the high TVL of the DeFi market as ETH is used as a means of paying transaction fees on the Ethereum blockchain network.
Therefore, the higher the demand for DeFi protocols and services, the more conducive to the value of ETH in the market.
The reserve of BTC and ETH continues to decrease on exchanges
Meanwhile, Bitcoin’s price shows no signs of slowing down as it has broken out of the $ 57,000 level and is holding the $ 50,000 zone as solid support. Part of the reason for this is that the number of BTC as well as ETH available on exchanges is decreasing, reducing selling pressure.
Additionally, as long as the Bitcoin price continues to demonstrate resilience above $ 50,000, ETH’s strong momentum is likely to be maintained in the near future.
According to analysts at Santiment, the crypto community also has a significant interest in ETH. When the price crosses $ 2,000, 33% of all crypto discussions are related to ETH. They wrote: “Well, the ETH price quickly reached over $ 2,000. The price went up to $ 2,041 just 1 hour after our post was posted! Address activity reached its highest level in a month. And 33% of all crypto discussions have something to do with ETH ”.
If the momentum of the dominant cryptocurrency Bitcoin remains intact and investors continue to withdraw ETH from the exchanges, the likelihood of the price continuing to surpass the $ 2,000 level is likely to increase.