Ethereum may achieve a further 100% profit by the end of

Data analytics firm Skew predicts a 7% chance that the price of ethereum will be 100% profitable by the end of 2020.The growth of the DeFi segment has led to the highest trading volume on the Ethereum blockchain in two years. After Cardano (ADA), Ether (ETH) was the second best performer among the top 10 cryptocurrencies in terms of market capitalization. It was driven by two major factors, the upcoming Ether 2.0 0 phase and the growth of the DeFi segment. The DeFi sector, in particular, is currently booming at an unprecedented rate, led by two projects, Compound and Maker.

According to DeFi Pulse’s data, the Total Value Locked (TVL) in the DeFi sector has reached new historical highs. The TVL presented a significant drop in March, but has been growing steadily to reach 1.53 billion USD, at the time of publication.

At the same time, the growth in the DeFi sector has led to an increase in the Ethereum’s on-chain activity. A few days ago, the Ethereum miners voted to increase the gas limit per block from 10 million to 12.5 million. The adjustment was driven by the increase in fees on the network that was especially affecting some protocols in the DeFi sector that need low tariffs and a stable price to operate.

After the adjustment, the daily transactions on the Ethereum blockchain reached a two-year high of 1,073,442 and are on their way to the all-time high of the ICO boom.

Probability of a new all-time high for Ethereum

However, despite the strong demand, data analysis firm Skew said that the market is not yet aware of the growth of the DeFi sector and the potential of stablecoins such as Tether. In that sense, Skew predicts that the probability of the Ethereum reaching a further 100% price gain in 2020 is just 7%.

Probability of Ether > $480 (+100%) by End of Year = 7%

Stable coins and DeFi seems like a more sustainable product / market fit for Ethereum compared to ICOs in 2017 but the market doesn’t see it (yet?) necessarily as adding as much $ value for Ether.

So a massive rally before the end of the year, as predicted by many other analysts, according to Skew, seems unlikely. This is supported by Jacob Franek, co-founder of the Coinmetrics platform. Franek acknowledged that there are reasons to feel optimistic, but said that his 10 years of experience in crypto space urges him to be cautious:

(…) it could take another 2-5 years before very large institutions are comfortable shifting critical infrastructure onto ETH 2.0 and purchasing stake. That doesn’t happen in 6 months under any optimistic scenario.

Author : Reynaldo