DeFi is having a moment. And while that may not be doing wonders for the price of Ethereum (ETH) itself, the tokens built on top of the network are having a great year.
Total market capitalization for all ERC20 tokens running on Ethereum has exceeded $ 33 billion, according to data compiled and shared by The defiantby Camila Russo. The source of the figures comes from EtherScanEthereum’s most popular block explorer.
And at $ 33 billion, the estimate exceeds the total market capitalization of ETH, the native token of the Ethereum blockchain, which today is worth roughly $ 27 billion.
It all boils down to the full value of the built economy around Ethereum now exceeds that of ETH, the token that holds the blockchain. And this doesn’t even consider the value of unique ERC721-based tokens (like those issued by CryptoKitties or Gods unleashed), who move several million dollars on their own. Therefore, the gap is even wider.
Of all the applications running on Ethereum, the the most valuable are currently related to decentralized finance. How Decipher previously reported, DeFi Tokens They are currently growing much faster than Bitcoin, or any other cryptocurrency on the market. At the moment, it looks like it’s DeFi, swap tokensand high risk dapps that attract the most attention from investors.
Blockchain > crypto?
Depending on how you look at it, this could be a sign of market maturity. Ethereum could be proving its value as a decentralized global supercomputer on which various applications are built.
In other words, the value of Ethereum as a technology probably cannot be measured simply in terms of ETH’s market cap. ETH, after all, is but one part of a complex ecosystem that continues to evolve. (It may even be a sign that Ethereum co-founder Joe Lubin can still earn his bet against Bitcoin maximalist Jimmy Song, if mass adoption of dapps actually becomes a thing).
And with Ethereum 2.0 just around the corner (at least according to some ETH developers), the big DeFi boom of 2020 may be a sign of what’s to come.
On the other hand, DeFi advertising could also fade away as the 2017 ICO craze. Market participants will ultimately decide.
Disclaimer
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment or other advice.
