Cryptocurrencies

    Is digital art behind the record Ethereum price run?

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    Highlights
    • The price of Ethereum has skyrocketed 521% since January 1, 2021.
    • Digital art auction platform OpenSea this month recorded US$10bn in total sales since inception.
    • Ethereum is the crypto payment of choice for OpenSea?s auctions of Non Fungible Tokens or NFTs.

    The price of the world?s second largest cryptocurrency, Ethereum, has skyrocketed by 521.55% since January, in part due to its role as a payment mechanism for digital art, or Non Fungible Tokens (NFTs).

    NFTs can be anything digital (such as drawings, music or thoughts turned into an AI) which are stored on a digital ledger, or blockchain.

    Sales of NFTs surged to a record on the digital art auction platform OpenSea in August, on the back of rising demand for the likes of CryptoPunks, ArtBlocks, Bored Apes and Parallel Alpha.

    For the many skeptics about the legitimacy of digital art ownership, even global auction house Christies has joined the NFT bandwagon with a digital artwork auction earlier this year which sold a total of US$69 million of NFTs.

    In the first 10-days of November, OpenSea has already experienced sales volumes above $50 million.

    While there are other contributing factors to Ether?s price rise, the price of Ethereum is certainly moving in lock-step with the sales volumes for NFTs.

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    Grafa