As detailed in today’s Blockonomi market update, Bitcoin hasn’t done too well over the past two days, not to mention the poor performance since the $10,500 high established in mid-February.
Despite this market weakness, which comes as almost all traditional markets have experienced a similar sell-off due to the fears of the coronavirus outbreak and an ongoing oil war, Ethereum’s underlying ecosystem has continued to see interest from investors and corporations looking to leverage modern technology, likely boding well for ETH’s long-term performance.
Capital and Interest Continues to Flood Into Ethereum
Over the past few days, Ethereum has seen a flurry of positive news events.
On Saturday, Forbes Crypto reported that investment rating and financial services giant Morningstar — which pledged to use Ethereum months ago as covered in this Blockonomi report — leveraged its first ETH-based security.
The report indicated that Fatburger received a $39.7 million capital injection, which was benefited by Morningstar’s Ethereum-based rating system, which purportedly increased “transparency.”
This isn’t the only time Ethereum has been used for interacting with a bond created by a prominent financial institution. Previously, Santander issued a $20 million end-to-end bond through Ethereum, using a series of smart contracts and ERC-20 tokens to conduct this pilot.
Aside from Ethereum-based bonds, CoinDesk reported on Sunday that Argent, an Ethereum wallet focusing on the decentralized finance ecosystem, raised $12 million in a Series A round, led by Paradigm Capital, founder of Compound Robert Leshner, and Index Ventures, bringing the startup’s total raise to $16 million since its December 2017 launch.
Argent’s Series A raise confirms the existence of demand for DeFi products, which have become crucial for the success of Ethereum, some industry members have said, such as a Coinbase product manager and DApp Radar’s communication director.
Indeed, per previous reports from Blockonomi, Raoul Pal, a former head of equities and equities derivatives at Goldman Sachs and an early adopter of Bitcoin since 2013, said he’s become “increasingly bullish on Ethereum” due to the existence of DeFi.
Pal has explained in a number of commentaries and interviews that he sees a world in the future where everything is based on blockchain technologies, where there are cryptocurrencies like Ethereum and Bitcoin being used in a number of capacities. For instance, speaking to Anthony Pompliano in an interview published last week, he said that “all his friends” working with crypto are using Ethereum.
The idea here: if there is a world where everything is based on blockchain, Ethereum-based DeFi has one of the biggest potentials amongst crypto platforms to become the backbone of the financial system because of its current infrastructure and level of development.
ETH “Whales” Enlarge Holdings
Amid this macro backdrop for Ethereum, large holders of the cryptocurrency have continued to enlarge their positions, per data from industry analytics provider Santiment. The firm wrote:
“The top 100 holders of Ethereum are once again beginning to accumulate higher percentages of the total token supply, in spite of the ongoing consolidation that has been occurring for the past couple of weeks.”
The top 100 holders of #Ethereum are once again beginning to accumulate higher percentages of the total token supply, in spite of the ongoing consolidation that has been occurring for the past couple of weeks. Generally, when this kind of accumulation starts to mount, it's a pic.twitter.com/Rr5C8vuE97
— Santiment (@santimentfeed) March 4, 2020
Explaining the concept further, they explained that this accumulation is a sign that those “who have the most stake in ETH […] are beginning to have a collective sentiment of the token being undervalued.”
Santiment, though, asserted that there may not be an immediate rise in the price of the cryptocurrency, but that the trend is “generally a good sign for Ethereum bulls.”