The much-anticipated ETH 2.0

Bitcoin price hits record high

In November, the crypto asset market was in jubilation as many crypto asset prices rose sharply. On the Binance platform, Bitcoin soared from less than $14,000 on November 1 to $19,888, setting a new record high and becoming the biggest hot spot. This rise is another milestone for Bitcoin, and its total increase in November has reached 42%. Despite the significant price increase, Bitcoin's market dominance failed to set a new record high for the year, and as of today, it is still at 63%. Bitcoin's market dominance has not continued to increase due to the sharp rise of non-bitcoin currencies during the same period. Under the tail effect of Bitcoin's success, high-market-cap non-bitcoin currencies have also achieved quite impressive performance, giving investors different investment options and diversifying their portfolios. As a result, the entire crypto asset economy has expanded significantly, with a market value exceeding the $560 billion mark.

Ethereum, the second largest crypto asset by market value, also had a phenomenal performance in November, with its market value rising by more than 59%. ETH 2.0 staking mining attracted a large number of participants, further boosting the bullish sentiment for Ether. After ETH 2.0 was officially launched on December 1, the market began to be cleaned up, and the price entered a highly volatile period. Within a few minutes, ETH fell from $635 to $560, a drop of more than 11%, staging a textbook-level "sell on news" (i.e. arbitrage exit when official news is released). Since then, the price of Ether has begun to recover and is currently in the range of $590-600. Since the beginning of the year, the price of Ethereum has risen by more than 350%, and its market value has exceeded $65 billion.

XRP is also one of the best performing crypto assets. After suffering a heavy drop of 177% a few years ago, XRP entered a downturn that lasted for several years and was almost forgotten. But in November, the price of XRP jumped from $0.22 to $0.78, more than tripling. Many crypto asset advocates are critical of XRP, believing that its operations are overly centralized and no different from traditional databases. But many XRP holders choose to ignore this criticism, believing that as large companies and financial institutions begin to enter the crypto asset field, XRP will continue to rise.

The surge in Bitcoin in 2020 has caught many smart investors by surprise. Since the crypto asset craze faded in 2017, Bitcoin has been criticized by many, mainly by conservatives in the traditional financial field. Today, various institutional investors, including some well-known fund managers, have gradually accepted and started investing in Bitcoin.

What awaits Ethereum after ETH 2.0?

While Bitcoin was dominating the headlines, another big event happened that could have a significant impact on the entire crypto-asset economy. This revolutionary event is Ethereum 2.0.

The purpose of the ETH 2.0 upgrade is to improve the Ethereum network in three important aspects: compatibility, scalability, and security. In addition, the Ethereum consensus mechanism will also be transformed into a proof-of-stake mechanism, incentivizing investors to participate in Ethereum staking mining. After meeting the recharge threshold requirements, the first part of the entire Ethereum 2.0 upgrade, also known as "Phase 0", was officially launched.

After completing Phase 0, the next step is to create shard chains. This will be a major upgrade and is expected to go live in 2021. After the upgrade is completed, the speed of the Ethereum network will be improved. In Phase 1.5, ETH 1.0 and ETH 2.0 will transfer all users and assets to the new network while maintaining existing operations, and such operations have never been implemented on a large scale.

Since one of the goals of this Ethereum upgrade is to enhance consumer feasibility, its use cases will increase significantly after the upgrade. However, since existing dApps and developer flows need to be migrated to the new network, the upgrade will take months or even years to complete. Therefore, users may not feel the changes brought about by the upgrade immediately. However, the impact of this upgrade is long-term. Enterprises and developers will not start running at full scale on the new network immediately, but will gradually verify and build confidence in the new system. Therefore, the use of the new network will also increase slowly.

But the most important question is: Can the ETH 2.0 upgrade activate more demand and push ETH to a new all-time high?