Ethereum became the most traded cryptocurrency on the Coinbase exchange during the three months through June, while investors explored the world of decentralized finance. It accounted for 26% of Coinbase’s trading volume in the second quarter.
Ethereum, the world’s second-largest cryptocurrency by market capitalization, shared for 26% of the trading volume on Coinbase, compared to 24% for Bitcoin, as a year ago, Bitcoin occupied 57% of total trading volume on the platform against 15% for Ethereum.
During the second quarter, the total trading volume on Coinbase was $462 billion, which is up 1,550% from $28 billion a year ago.
“Bitcoin may be a great store of wealth, but most of the innovation that’s happening in the crypto space right now is happening on the Ethereum blockchain,” noted Mati Greenspan, CEO of Quantum Economics, a Tel Aviv-based project to study financial markets.
The Ethereum blockchain is commonly used for decentralized finance (DeFi) and non-fungible tokens (NFTs), two applications that have recently boomed the crypto world. DeFi services do not rely on banks or other financial intermediaries to offer financial instruments and instead uses the blockchain, most commonly Ethereum, for peer-to-peer financial transactions. An NFT is a unit of data stored on the blockchain that proves a digital asset is unique and cannot be replicated, including artworks, music, and other types of digital pieces.
According to CoinMarketCap.com, the interest in DeFi and NFTs has helped surge Ethereum’s price by 344% this year to $3,240 a token, giving the cryptocurrency a market capitalization of $380 billion. While Bitcoin’s price in 2021 has climbed 58% to $46,490 a coin with a market cap of more than $871 billion.
On August 4, Ethereum has suffered its new upgrade with the codename “London,” which should improve the fee structure of each transaction, making those fees less volatile while reducing the amount of ETH in circulation. As a result, Ethereum has surged by more than 8% over the day alone.