Ethereum has been around since 2014 and is the second largest cryptocurrency by market cap. While both Bitcoin and Ethereum can function as a sort of “digital gold”/store of value and method of payment, that is not what Ethereum was designed to accomplish. The Ethereum blockchain is pioneering as a platform for executing smart contracts, which means that decentralized applications (dApps) can be run on it. In fact, the burgeoning decentralized finance (DeFi) sector, which saw such tremendous growth in 2020, is built almost exclusively on Ethereum.
The blockchain’s native token, Ether (ETH), is used to secure the network and is required for paying transaction fees (aka gas fees). Since its launch, the price of ETH has changed significantly, and if you want to know why then you’re in the right place. We’ve compiled everything you need in order to understand ETH price – as well as the factors which influence it.
Ethereum Price History
After a $2.2 million initial coin offering (ICO) in the summer of 2014, the Ethereum blockchain launched at the end of July 2015 – and by mid-August ETH was trading at above $1.00. Prices dipped below $0.50 that year but were inching back towards $1.00 by the end of 2015. In the first quarter of 2016, ETH rallied more than 1500% to hit a price of over $15 in March, before going on to peak at over $21 in June. Prices crashed to about half that value over the next couple of days and Ether spent the rest of the year mostly in decline, closing the year just under $8.
After a slow start to 2017, ETH had climbed back up to $15 by March. It more than tripled that month and broke $100 in May, shortly followed by $200. June took prices up to about $415, after which ETH saw roughly five months of consolidation. The gains only resumed in December, and by the end of 2017, ETH was worth over $750, representing an increase of around 9400% since the start of the year.
The rally continued into the start of 2018, peaking at just over $1,500 on January 10th. Like the greater crypto market, ETH spent the rest of the year in decline and ended up trading at about $130 by the end of 2018 – a more than 90% fall from its January peak. The following year saw some less dramatic changes – Ether climbed for the first half of the year and reached over $380 around the end of June. Those gains were then lost in the second half of the year, and ETH ended 2019 at about the same price it had started the year with.
2020 showed an upward trajectory on the whole. Ether doubled in the first couple of months and then bottomed out at $84 following a crash of almost 45% in a single day in March. This marked the start of a period of growth and by the end of the year, ETH had reached about $740, which represented gains of 475% for the year.
Growth accelerated in 2021, with prices doubling in January. The rally also continued into February until a 40% pullback briefly took ETH below $1,300 at the end of the month. After a month of consolidation, however, the gains resumed and on 10 April 2021 Ether reached its all-time high of $2,238.77 – a year-to-date increase of over 200%.
Analyzing Ethereum’s Price History
The overall price trend of ETH tends to follow what’s known as a boom-and-bust cycle. This is a pattern in which a period of growing excitement leads to a surge in price before doubt and disillusionment set in and result in a crash. Throughout Ethereum’s history, the project has seen many developments and setbacks which have driven these changes in sentiment.
At the end of February 2016, Ethereum announced the launch of Homestead, the second major version release of the Ethereum platform, which likely fuelled the impressive price growth that ETH experienced around that time. The success of The DAO (decentralized autonomous organization), which launched on Ethereum soon after, also provided a boost. The project experienced problems that year as well, however, notably when The DAO was hacked and $60 million worth of ETH was stolen. This event coincided with the major downturn in Ether price after its 2016 peak.
2017 brought an eToro listing for Ethereum and the release of the Byzantium network upgrade. There was also a boom in new Ethereum-based projects fundraising through ICOs, for which Ether was required as a means of payment for the ERC-20 token being sold. These developments no doubt contributed to the meteoric rise in ETH’s price that year.
The ICO hype diminished in 2018, and many of the projects that had already raised funds sold their ETH – flooding the market. This, along with a delay to Ethereum’s update schedule later in the year, sent prices plummeting.
In 2020 and 2021 the DeFi sector exploded, bringing new life to the Ethereum blockchain. A plethora of new projects emerged and found success offering a range of different services, all built on top of Ethereum. In fact, in April 2021, the total value locked (TVL) in DeFi exceeded $50 billion. All of this new activity on Ethereum increased the demand for its native ETH token (needed to transact on the network), sending its price to dizzying new heights.
Trends in the rest of the crypto market and the wider economy also played a role in ETH’s price history. Its biggest surges came at the end of 2017/start of 2018 and the end of 2020/start of 2021, and these rallies weren’t unique to Ethereum – the whole crypto market pumped around these times. Both surges corresponded with the major bull run for Bitcoin, and with such large market dominance, any significant move for Bitcoin often affects the rest of the market.
ETH’s huge single-day crash in March 2020, on the other hand, wasn’t confined to the crypto market. This came as economies and borders were closing down around the world in response to the COVID-19 pandemic. The effect of this was felt by the whole cryptocurrency sector and the entire stock market, which experienced the biggest single-day crash since 1987.
Factors Influencing The Price of Ethereum (ETH)
Unlike Bitcoin, ETH doesn’t have a max supply – at least not yet. It will continue to be created at each new block indefinitely, with the issuance rate being adjustable through consensus so as to maintain network security. Because of this, the price of Ether isn’t driven by scarcity so any price appreciation requires an increase in demand that outpaces the growth of supply.
The primary source of ETH demand is its utility for paying transaction fees on the Ethereum network. This is needed not just for sending ETH but for carrying out any operation on the blockchain, such as using dApps and interacting with ERC-20 tokens. As such, the growth of ETH price is heavily influenced by the growth of the DeFi sector, which can be seen in the correlation between the price of ETH and the TVL (total value locked) in DeFi.
In a similar vein, Ethereum is also used for the creation of non-fungible tokens (NFTs), which can represent everything from digital art, real estate, and gaming items to a wide range of other things. NFT popularity took off in late 2020, further driving demand for ETH.
The upcoming Ethereum 2.0 upgrade will transition the blockchain from proof-of-work to proof-of-stake, thereby increasing throughput and reducing transaction fees. In addition to influencing ETH demand through its effect on the generally positive sentiment around Ethereum, the upgrade also affects circulating supply as ETH is staked in ETH 2.0, locking it out of circulation. By April 2021, about 3.8 million ETH, representing 3.3% of the total supply, had been locked up in ETH 2.0 deposit contracts – removing it from circulation at least until the upgrade is rolled out.
Ethereum also attracts many speculative investors. As the emission rate of Ether slows over time, a lot of investors see its potential as a digital store of value. Bitcoin’s growth was helped by a wave of institutional investment, and following this, many firms are turning their attention to the next biggest cryptocurrency – Ethereum. There have also been filings to create Ether ETFs (exchange-traded funds), which would introduce traditional stock market investors to ETH.
Live Ethereum Value and Market Cap
The live price of Ethereum varies from moment to moment as it’s dictated by the balance of buyers and sellers on exchanges, which is in constant flux.
Given ETH’s volatility, its live price can change by a large amount in a very short space of time. The market cap of Ethereum is equal to the price of ETH multiplied by the number of ETH in circulation.
The current price of Ethereum is EUR. It has changed by EUR in the last 24 hours and ETH has a 24-hour trading volume of EUR. Ethereum current Kriptomat ranking is , with a market cap of EUR. It has a circulating supply of . Max supply is ETH.
Ethereum Price FAQ
What was Ethereum’s lowest price?
The value of ETH hit a low of $0.42 on 21 October 2015, shortly after the project was launched.
What was Ethereum’s highest price?
ETH reached an all-time high of $2,238.77 on April 10th, 2021, propelled by the growth of the DeFi sector and the 2020/21 bull run.
How is the price of Ethereum calculated?
Ether’s price at any given time is decided by the balance of supply and demand on exchanges. When more people are buying ETH than selling it, the price goes up, and when more are selling than buying, the price goes down.
Why is the price of Ethereum different on different cryptocurrency exchanges?
ETH’s price is based purely on trading as there is no standard global Ether price, so no one knows what it is “supposed” to cost. The trading volume and liquidity are different for each exchange and those differences are what affect the price.
What will Ethereum be worth in the future?
It’s impossible to make price predictions with any kind of certainty as a whole host of different factors could impact Ethereum’s future value. However, if the popularity of DeFi and NFTs continues to grow, and the Ethereum 2.0 upgrade goes smoothly, the value of ETH is likely to grow.
The price of Ether has seen significant change during its long history, from being worth less than $1.00 shortly after its launch to reaching the dizzying heights of over $2,200 in April 2021. The journey wasn’t a smooth one, however, as ETH’s volatility led to many surges and crashes along the way for active traders to take advantage of.
A variety of different factors have played a role in determining the price of ETH, including the growth of the DeFi sector, the rollout of the Ethereum 2.0 upgrade, and trends in the rest of the crypto market and wider economy. Its current valuation is derived from the balance of supply and demand in the markets and constantly changes.
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