Top 3 reasons to buy Ethereum

Top 3 reasons to buy Ethereum
Ethereum has been dominating the charts for the last week by printing one green candle after another. Despite technical indicators showing multiple bearish divergence on the 1-hour and 4-hour charts, the second-largest cryptocurrency is not slowing down. This has been a very exciting year for Ethereum with the implementation of DeFi smart contracts and more. Today we take a look at the top 3 reasons to buy Ethereum.

1. Ethereum 2.0 testnet aka Medalla, is coming

The long-awaited launch of Ethereum 2.0 Medalla has been announced for 4 August 2020. Even though this is a tentative date, it is reason for celebration. So, what exactly is Ethereum 2.0?

Currently Ethereum 1.0 is in use. Ethereum 2.0 differ from 1.0 in the sense that it will make the network faster, more scalable and energy-efficient. The improved network will run on Proof-of-Stake (PoS) and benefit from a sharding chain and staking. Ethereum 2.0 will ensure the network is more secure and scalable so that individuals and businesses can make use of the blockchain.

It is by far the biggest update for the Ethereum network!

2. U.S. Banks providing custody services for crypto assets

Recent news that U.S. banks can provide custody services for crypto assets had a positive affect on the market. This means that several banks that operate within the U.S. can hold cryptographic keys of cryptocurrency wallets on behalf of their customers. This is a big step towards mainstream adoption and will have a positive impact on Ethereum as well as other cryptocurrencies.

3. Ethereum benefits from DeFi market expansion

The Decentralized Finance (DeFi) market has taken the crypto industry by storm. Announcements of tokens offering DeFi services to traders, make headlines on a daily basis. Whilst DeFi tokens are definitely the flavour of the month, they have greatly benefitted Ethereum. The DeFi eco system uses the Ethereum blockchain to create these peer-to-peer financial networks.

Speaking of which, DeFi is great for cryptos because it eliminates the need for central financial authorities and middlemen when obtaining financing. The majority of DeFi protocol’s $3.75 billion total value is locked in Ethereum.

In the last month, various DeFi tokens like Compound (COMP) reached new all-time highs. For example, COMP went from a low of $64.93 to a new all-time high of $353.18 in a very short time frame.

AltCoinTrader recently listed DeFi tokens COMP and the DAI stable coin. The only downside to DeFi and Ethereum is the increase in gas fees. Some crypto traders have noted on social media that the increased activities on the Ethereum network brought on by DeFi, has seen rising gas fees. In order for any activity to occur on the Ethereum network, including smart contracts, gas is needed.

In conclusion, all eyes are on Ethereum for the Medalla testnet release on 4 August. If this final testnet is a success, Ethereum 2.0 mainnet could be rolled out in a couple of months and have a significant impact on the price of Ethereum.