Ouyi OKEx Observation: Two Reasons to Understand the Skyrocketing Logic of Ethereum

In the past few days, the price of Ethereum has hit new highs, becoming one of the most watched mainstream assets in the encryption market.

According to the OKEx market, Ethereum hit $3,548.41 on May 6, an increase of nearly 30% from the lowest point on May 1 ($2,732). Since the beginning of the year, the highest increase of Ethereum has reached 389%.

The market trend of Ethereum within the year (source: OKEx)

In terms of market value performance, Ethereum also ushered in a bright moment. According to AssetDash data, the current market value of Ethereum is about 402.3 billion US dollars, ranking 17th in the global asset market value list, surpassing Wal-Mart and approaching Samsung and Johnson & Johnson.

Ouyi OKEx will open MINA/USDT market trading at 8:30 on June 1: Official news, Ouyi OKEx will list Mina Protocol (MINA), and open MINA deposit at 22:30 on May 31, June 1 At 8:30, the market trading of MINA/USDT will be opened. [2021/5/31 22:59:48]

Regarding the reasons for the strong rise of Ethereum, William, the chief researcher of Ouyi OKEx Research Institute, summarized two points in an interview with the media:

First, blockchain networks are different from ordinary networks. On ordinary networks, most of the value will be concentrated in the application layer (such as Amazon, Facebook), but it is difficult to capture value at the network protocol layer (such as TCP/IP protocol); The network protocol layer where the value is concentrated (such as the Ethereum network), and a small part of the value is distributed in the application layer (distributed application). The main reason is that the encrypted digital currency (ETH) issued by the blockchain network protocol layer is the basis for the normal operation of all distributed applications (as gas fuel fees, collateral, investment and financing). Taking distributed finance as an example, currently 90% of DeFi is concentrated in the Ethereum network. Since the explosion of DeFi applications in June last year, the lock-up value of the DeFi protocol (ETH lock-up volume) has grown exponentially. The prosperity of DeFi has directly driven the market demand for ETH and driven up the price of ETH.

Ouyi OKEx launched MATIC, FLOW, SAND, PERP leveraged trading, Yubibao and some perpetual contracts: On April 2, Ouyi OKEx officially announced that it will be officially launched on the web, APP and API at 17:00 on the same day Margin trading of MATIC, FLOW, SAND, PERP, Yubibao and SANDUSDT, PERPUSDT perpetual contracts.

At present, OKEx has supported leveraged transactions of high-quality projects that have been launched on various platforms, Yubibao and USDT perpetual contracts, and continues to provide platform investors with diversified trading options. [2021/4/2 19:40:09]

Secondly, the Toronto Stock Exchange of Canada launched three Ethereum ETFs at the end of April, which are the most popular ETFs in the traditional financial market. Investors have provided a compliant channel for capital entry; the European Investment Bank has also reported that it will issue digital bonds on Ethereum; these news are directly beneficial to the rise of ETH prices.

Ouyi OKEx currency broadcast: CONV continued to rise, with an intraday increase of 118.95%: According to Ouyi OKEx platform data, the market rose slightly today, BTC rose slightly to 53,125.7 USDT and then fluctuated left and right, and is now stable above 52,000 USDT;

According to the OKEx market, the top three currencies in the daily price increase list are: CONV, DORA, and QTUM; the largest increase in the Polkadot ecological category is DORA; the largest increase in the NFT ecological category is CHZ.

As of 15:00 on March 26, the prices of popular currencies are as follows: [2021/3/26 19:20:08]

However, from the perspective of the entire encryption market, the recent market has been polarized. On the one hand, Ethereum, Dogecoin, ETC, BCH, etc. have risen alarmingly; on the other hand, Bitcoin continues to fluctuate, and its dominance over the encryption market seems to be weakening.

The reason is that William believes that Bitcoin can be regarded as the "Moutai" in the field of encrypted digital currency. After nearly half a year of Bitcoin bull market, due to the high price of Bitcoin, the price base is too large, and it is difficult to obtain high returns for funds now. , so most of the funds are holding a wait-and-see attitude. As long as the price of Bitcoin falls, they will cover their positions. This is also one of the reasons why the price of Bitcoin has continued to fluctuate recently.

Compared with Bitcoin, other high-quality encrypted digital currencies are still in a "price depression", such as Ethereum, which must rise to at least $4,000-5,000 to reach a similar level to Bitcoin; Dogecoin, an old-fashioned large-block currency such as BCH, has been chased by market funds.

In view of the continuous decline in the market value of Bitcoin, the industry speculates whether Ethereum is expected to take over Bitcoin and carry the market banner. William disagrees with this: Bitcoin can be regarded as the "Moutai" in the encrypted digital currency market, and its dominance is difficult to be shaken. The current encrypted currency market is in a bull market, so various altcoins generally rise, which in turn lowers Bitcoin. Bitcoin's market share, the market will enter a bear market in the future, and Bitcoin's market share will increase again.

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