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Ethereum's market cap on Friday was $410 billion, second to Bitcoin's at more than $1 trillion, according to data tracker It hit a record high of $3,610.04 on Thursday and was last up 1% at $3,524.

The Ethereum blockchain is based on smart contracts, which Allows for decentralised application such as widely used decentralised Service (DeFi). In the crypto world, the terms "Ethereum" and "Ether" have become synonymous. Technically, Ethereum is the blockchain network in which decentralized applications are embedded, while ether is the token or currency that enables or drives the use of these applications.

Ethereum has outperformed major digital currency rivals this year, bolstered by the surge in decentralized finance (DeFi) and the anticipation of a technical adjustment this summer, but it faces hurdles that could stall its rise. With a jump of more than 350% in its price this year, Ethereum has the second-largest market capitalization after Bitcoin, but not as much cache and perhaps more operational challenges that could prevent it from eclipsing its major rival.

A rise in institutional interest has increased Ethereum demand, but supply has been limited. At the heart of Ethereum’s ascendancy is DeFi, which refers to peer-to-peer crypto-currency platforms that facilitate lending outside traditional banking institutions. Many sites run on the Ethereum network, using an open-source code with algorithms that set rates in real time based on supply and demand.

Ethereum has also been plagued by the network's inability to scale to meet demand without incurring high transaction fees as well as slow execution of transactions. The first phase of an upgrade called Ethereum 2.0 launched last year is aimed at addressing the network's tech issues on speed, efficiency, and scalability.

Ethereum's price all set to touch new high and could be similar to a Bitcoin halving event, in which an adjustment cut Bitcoin's supply and propelled its price to record highs.

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