Ethereum's market cap inches closer to Platinum after surpassing Toyota, Netflix
6 Jul, 2021 CryptoParrot
Second-ranked cryptocurrency Ethereum continues to outperform other rival digital assets due to increased interest from investors and the network's utilization in real-world use cases. With the recent rally, Ethereum's market capitalization has now surpassed some notable traditional assets.
Data acquired by cryptocurrency trading simulator Crypto Parrot indicates that among selected assets, Ethereum's (ETH) market cap of $268.8 billion as of July 6, 2021, is higher than Exxon Mobil's (XOM) $258.99billion. Furthermore, the crypto's valuation ranks higher than Nike's (NIKE) market cap of $249.72 billion. Motor manufacturer Toyota's (TM) market cap of $242.79 billion also ranks lower than Ethereum.
Elsewhere, Platinum's (PLAT) market cap of $270.6 billion tops the ten selected assets. ICBC (1398.HK) is a notable asset with a slightly superior market cap than Ethereum at $268.99 billion.
Ethereum market cap benefits from asset's rising value
Worth noting is that Ethereum belongs to a different asset class compared to the selected companies. Ethereum is a digital asset, while the companies are for-profit businesses with tangible products and services. Furthermore, some of the traditional asset classes remain superior to Ethereum despite a lower market cap.
Some traditional companies control trillions of assets under management, and they also pay dividends based on their performance. However, Ethereum compares to stocks since holders can also benefit from rising demand and value. Overall, the Ethereum market capitalization, to some extent, is a beneficiary of the recent general cryptocurrency bull run.
Ethereum market cap is a direct result of the early 2021 crypto bullish price movement that saw the asset hit an all-time high of $4,300 on May 12. The growth in Ethereum has seen the crypto surpass the number ranked Bitcoin in daily active addresses for the first time.
Although Ethereum's price has corrected in recent weeks, multiple factors have driven the asset's overall value led by the surge in the Decentralized Finance sector. There is growing utilization of the Ethereum network among DeFi projects. Notably, the DeFi ecosystem has been on the rise over the past year.
Elsewhere, the exponential rise in the non-fungible tokens (NFT) has contributed to Ethereum's surge. Most NFTs are running on the Ethereum smart contracts, giving the asset prominence.
At the same time, institutions are also showing interest in Ethereum's public blockchain. Institutions are looking for ways to leverage the network in the wake of Bitcoin stagnating faced with regulatory and environmental concerns. The factors have played a role in institutional activity around Bitcoin slowing down, but some analysts believe the scenario offers other assets like Ethereum an opportunity to fill the void.
There is also general excitement regarding the Ethereum network's future development. For example, there is anticipation regarding Ethereum's London hard fork that could transform the network into a better store of value by creating more scarcity in the cryptocurrency's supply.
Currently, there is a proposal to schedule the mainnet activation for Aug. 4. Additionally, the Ethereum 2.0 upgrade is attractive to developers and investors as it improves the speed, efficiency, and scalability of the network that increases the number of transactions.
Traditional assets in recovery mode
Some of the traditional asset classes are still in recovery mode after experiencing a turbulent 2020 that resulted from the general stock market crash. However, the stock market has since recovered to record levels led by specific sectors not represented by some selected companies.
Interestingly, some of the traditional players might also record a surge in valuations due to the integration of digital assets.
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