Ethereum Explodes As DeFi Boom Sees Coin Gain 20% In Week – Is $500 Next?
Although most mainstream market analysts will tell you about the whopping 65% gains for Bitcoin so far this year (the most famous crypto stands to breach $12k again soon), Ethereum has been making headwinds in the background as well. The coin’s usage as being the official blockchain for most DeFi projects means it has swelled a whopping 20% in a week, climbing ever closer to the $500 level.
Yearn.finance and SushiSwap
As we’ve mentioned, the rapid price increases of coins such as yearn.finance (YFI), which first made the news when it flipped the Bitcoin price and the newly created SushiSwap which breached through $10 in just four days means that the Ethereum blockchain is heavily referred to as a swap for other tokens as this is how DeFi essentially works.
The fact that this new industry has gathered near $9 billion in market capitalization and its own ranking on CoinMarketCap for its coins altogether means the crypto world is taking it seriously by now.
However, Vitalik Buterin, inventor and CEO of Ethereum, is skeptical of the rapid rise of some of these newly minted crypto “unicorns” and claims that they bring no real value to the industry. Even though his personnel must be jubilant to see their own coin’s value rise as a result, Vitalik is hesitant to give his seal of approval.
I personally am steering clear of the yield farming space completely until it settles down into something more sustainable. But I'm not particularly a "smart mind in defi" so.... https://t.co/1Db86JwP0D— vitalik.eth (@VitalikButerin) August 31, 2020
The young Russian-Canadian developer, who is sometimes accused of being too technical in his explanations, put it forward in quite reasonable terms this week when he replied to a question about the actual value of these new DeFi projects, stating:
The thing is, I see no plausible path toward them generating cash flows. That requires building applications that generate fees.
But the thing is, I see no plausible path toward them generating cash flows. That requires building applications that generate fees.— vitalik.eth (@VitalikButerin) August 31, 2020
Vitalik has since steered clear of commenting further on DeFi and launched a thread about the height of Ethereum’s gas fees instead.
Ethereum climbs to 1.87% to $472 at the time of writing.