Ethereum creator Vitalik Buterin became a billionaire after the rise of the ether above $3,000
Russian-Canadian programmer and founder of the Ethereum smart contract platform Vitalik Buterin has gained the status of a billionaire, after the rate of the cryptocurrency created by him reached another historical high this Monday.
In 2018, Buterin revealed the address of his main wallet on the Ethereum blockchain. To date, it contains 333,520 ETH worth $1.055 billion at the current exchange rate. Since the beginning of the year, when ether was trading around $700, the value of Buterin's assets has quadrupled. The high demand for cryptocurrency allowed the 27-year-old Buterin to become the youngest billionaire in the industry.
ETH hit a new all-time high around $3,200 today. It took less than 12 hours for the cryptocurrency to rise to this level, after it broke the psychologically significant level of $3,000 for the first time tonight. Analysts say that the main factor in setting new records was the activity of traders in the spot market.
"Funding rates in the ETH market remain flat and have even fallen into negative territory on the FTX today," said Matthew Dibb, Chief Operating Officer at Stack Funds. " We believe that the ETH spot rally is primarily due to expectations for the EIP-1559 update."
High funding rates imply a rapid increase in the volume of speculative bets on the futures market, which is not observed in the latter case. Stock exchange funding rates generally remain at near-zero values, indicating that there is no overheating. High funding rates can also portend a sharp collapse in the exchange rate due to the cascading liquidation of high-margin positions. This was the case, for example, in January and mid-February, when the indicator exceeded 0.15%.
The analytical firm Laevitas believes that the rise of ETH may have a continuation. "Despite the fact that the ether has flown through $3,000, the funding rates remain absolutely flat. Because of this, there is a clear sense of a steady rally caused by activity in the spot market, " analysts say.
Ki Yong-joo, CEO of cryptocurrency market data company CryptoQuant, said: "About 400,000 ETH left Coinbase wallets a few days ago. My speculative guess: the institutionals are now buying ether."
Some bidders are betting that the next stop for ETH will be $5,000. This is indicated by transactions on the options market of the Deribit exchange, where the most popular position was a bullish bet on ether with a given strike price. Traders take such positions due to their cheapness, while the probability of a profitable settlement by the end of the second quarter is estimated by the market at less than 10%. Ether remains vulnerable if bitcoin decides to make a sharp turn down.