This week in crypto: Ethereum bull run continues as prices hover near $4,000

Inside Ethereum’s record-breaking rally. Also: survey says 77% of millennials interested in crypto

Published on May 10, 2021

Ethereum briefly touches $4,200, up nearly 40% since start of May

In last week’s report, we broke down some of factors that have been driving Ethereum to record-breaking highs — from the adoption of decentralized finance (or DeFi) protocols and the surge in stablecoin popularity to the ongoing rollout of the ETH2 upgrade and increased interest from Wall Street. 

ETH prices have continued to hit new peaks, topping out at $4,200 on May 10 — a nearly 50% increase since the start of May. It’s been a remarkable run for the second-biggest cryptocurrency by market cap — and global search interest reflects that fact. (Learn how Ethereum works, how to buy it, and much more.)

  • Uniswap, the largest Ethereum-powered decentralized exchange, launched its v3 upgrade on Friday, aiming to make trading more efficient. Uniswap processed over $51 billion worth of trading volume in April; this week global search interest for Uniswap reached all-time highs.

  • Following the successful launch of ETH exchange-traded fund (or ETF) in Canada, New York-based fund manager Van Eck applied to create the first Ethereum ETF here. (Learn about ETFs)

  • Ethereum 2.0 staking project Lido raised $73 million in new funding, aiming to help accelerate the upgrade that should improve security and lower costs to use the network.

Forbes reports that over one percent of Bitcoin’s total supply is “at work” in the DeFi ecosystem on Ethereum. Bitcoin can be “tokenized” on the Ethereum blockchain for use in DeFi protocols. There are a wide variety of tokenized Bitcoin protocols on Ethereum, with wBTC (wrapped Bitcoin) being the largest.

DOGE continues wild ride

Despite Ethereum’s big numbers, another cryptocurrency clearly loomed largest in the popular imagination in recent weeks, as Dogecoin took the momentum it gained as an ancillary player during March’s memestock boom and continued to grow right up until “Dogefather” Elon Musk hosted Saturday Night Live this weekend. 

Musk made good on promises to joke about the token on air (his mom even got in on the action during the monologue), but by early Sunday morning, the altcoin had lost more than 30 percent of its value. After a brief rally, prices on Monday slumped again to a fraction of their pre-SNL peak — although as of Monday AM they remained up 10,000 percent for the year. Musk, however, isn’t done with the meme-inspired coin. On Sunday he tweeted that SpaceX is “launching satellite Doge-1 to the moon next year.” He added that the mission would be paid for in DOGE and would be the “first meme in space.” 

Mastercard survey finds 40% of respondents plan to use crypto in the next year; Tom Brady, Paris Hilton boost Bitcoin laser-eye meme

In a recent survey commissioned by Mastercard — of 15,000 people in 18 countries — 40 percent said they plan to use cryptocurrency in the next year. Millennials are the demographic most interested in crypto:

  • 67 percent of millennials are more open to crypto than they were a year ago

  • 77 percent of millennials are interested in learning more about crypto 

  • 75 percent of millennials would use crypto if they understood it better 

Meanwhile, Tom Brady and Paris Hilton are the latest stars to add red lasers shining from their eyes in their Twitter-profile pics signifying their support for Bitcoin. Brady and Hilton have both also made news in the NFT world earlier this year. Seven-time Superbowl champion Brady announced that he was  founding an NFT platform for celebrities called Autograph. Hilton, meanwhile, has sold NFTs for millions of dollars and has dogs named Crypto Hilton and Ether Reum. “I've always been an undercover nerd, and I feel like I finally have found my people,” Hilton recently said of the crypto community. “They're just smart and brilliant and creative and fun and cool, and they get me.”

In other crypto-art news, auction giant Sotheby’s partnered with Coinbase Commerce to accept payment in BTC and ETH for the first time. The winning bidder for a Banksy piece called Love is in the Air (part of the May 12 Contemporary Art Evening Auction) can pay with crypto — the artwork is estimated to go for $3 million to $5 million.  

Wall Street’s latest crypto moves

In the latest piece of major evidence around mainstream finance’s increasing embrace of crypto, S&P Dow Jones announced the creation of indices tracking Bitcoin, Ethereum, and large cap cryptocurrencies. "Traditional financial markets and digital assets are no longer mutually exclusive markets," said Peter Roffman, global head of innovation and strategy at S&P Dow Jones Indices.

  • In its quarterly earnings report, payment company Square announced that revenue more than tripled, driven by Bitcoin sales via its popular Cash App. As of May 10, Square also holds over $400 million worth of Bitcoin on its balance sheet. “We see bitcoin as the internet's potential to have a native currency, and we want to further that as much as we can." CEO Jack Dorsey said.

  • Metromile, a publicly-traded digital insurance platform, announced that it would allow users to make or receive payments in Bitcoin. Further, Metromile will purchase $10 million worth of Bitcoin in the second quarter of 2021 for its balance sheet.

  • In response to growing client demand, UBS and Citibank are reportedly planning to offer crypto investing to wealthy clients.

  • Goldman Sachs announced the creation of a new crypto trading team and has begun trading in Bitcoin futures. In addition, Goldman led a $15 million investment in crypto data provider Coin Metrics.

  • Crypto custody firm NYDIG said that “hundreds” of US banks have enrolled in a service that will allow them to offer Bitcoin directly to account holders in coming months.

In other news: crypto’s global growth, U.S. and China race to explore central-bank digital currencies

Stablecoins have experienced significant growth over the past year. While they are typically seen as havens from crypto volatility or as a useful medium for trading between exchanges, another natural use-case is in developing economies. This week, fintech startup Tala announced a partnership with Visa to provide access to USDC for underbanked customers in emerging markets. Users would be able to make purchases from any of Visa’s 70 million merchants across the world.

  • Further evidence of crypto’s value in emerging markets: Mexican Bitcoin exchange Bitso raised $250 million to become Latin America’s first crypto unicorn. According to a Forbes report: “In Latin America, crypto is used primarily for speculation, trading and capital mobilization, driven by remittance needs, the devaluation of local currencies and expensive financial services.” 

  • MercadoLibre, a publicly traded e-commerce company based in Latin America with a market capitalization above $70 billion, announced that it purchased $7.8 million worth of Bitcoin in the first quarter of 2021.

  • Central bank digital currencies are gaining traction in the world’s largest economies. The Digital Dollar Project has committed to launching five pilots of a digital US dollar, in parallel with work by the Boston Fed and MIT. And China accelerated its rollout of the digital yuan to more users across the country.

  • Crypto startup DFinity is launching its long-awaited Internet Computer Protocol (ICP). For an extensive introduction to the Internet Computer, check out Messari’s guide to the new cryptoasset.

  • Wondering which cryptocurrencies would have provided the biggest return on investment (or ROI) over the last week, month, and year? Our weekly chart shows how you would have done: