Ether, the second largest cryptocurrency after Bitcoin by market capitalization, exceeded $3,000 per unit in US dollars for the first time yesterday (May 2). This followed a massive bond sale by the European Investment Bank.

Ether (ETH) is dependent on Ethereum, which is the most actively used blockchain and the backbone of several other cryptocurrencies and NFTs; according to Coindesk, as of this writing on Monday (May 3), Ether was at a new high of over $3, new high of over $250.

In fact, as Benzinga reported, Ether has surpassed $376 billion in market capitalization, making it worth more than Bank of America.

Last month, Bloomberg Law reported that European investment banks sold $121 million in digital bonds on the Ethereum blockchain. Goldman Sachs, Societe Generale, and Banco Santander were also involved. This and a series of updates to the Ethereum blockchain may be the reason for the recent surge in value.

On July 14, the Ethereum blockchain will undergo an upgrade called EIP 1559; according to Decrypt, this update will "burn" billions of ETH each year, reducing overall supply and increasing value. The update is done by purchasing ETH with Ethereum transaction fees and then destroying it.

"It's like a company buying back shares at a profit," Tim Ogilvie, CEO of Staked, an Ethereum infrastructure services company, told Decrypt.

According to Ogilvie, he believes that Ethereum could consume 1-4% of its supply each year. Unlike Bitcoin, which has a supply cap of 21 million individual tokens, the supply of Ether tokens is unlimited. And because the supply is unlimited, Ether has the potential to be inflated.

The Ethereum blockchain allows the cryptocurrency to maintain its value by purging a certain amount of Ether tokens per year. By not capping it, ether tokens should remain more affordable than bitcoin. At the time of this writing, bitcoin is trading at approximately $57,600 per U.S. dollar.

Another reason to be excited about the EIP 1559 update is the introduction of a flat fee for ethereum transactions. Currently, the market is an auction-like market with fluctuating transaction fees. A set fee could make it more affordable for buyers purchasing Ethereum from miners.