Ethereum surges to all-time high as decentralized finance builds momentum

Ethereum, the world’s second-largest digital coin, grew in value more than 4% to more than $4,700 Monday, an all-time high. Meanwhile, bitcoin – which grew 7% to $66,250 – rose to close to its highest-ever value, which is $66,900.

Why should we care?
Though it’s unclear what might have driven ethereum’s sudden surge, industry watchers say enthusiasm around decentralized finance (DeFi) may be a driving force. DeFi is an umbrella term that refers to blockchain-based services that don’t rely on financial intermediaries such as brokerages and exchanges. DeFi applications are typically built on the Ethereum blockchain. Ethereum also underlies many non-fungible tokens, which function as a type of digital proof of ownership for online artifacts. Non-crypto-native fintechs are also tapping DeFi applications to introduce customers to blockchain-backed financial products. For example, neobank Current is examining how to incorporate DeFi offerings into its platform, in partnership with Compound, a DeFi protocol that allows users to lend and borrow crypto. Compound Treasury, an offering aimed at non-crypto businesses and financial institutions, allows non-crypto businesses to offer high-yield interest accounts powered by USD Coin. Meanwhile, analysts say a bitcoin surge coming is likely the consequence of the listing of the first U.S. bitcoin futures exchange-traded fund.