In a feat that only bitcoin has managed to achieve in the digital currency world, the market capitalization of a cryptocurrency called ether exceeded $2 billion and it hit an all-time high on Monday.
Run on a different blockchain to the one that powers bitcoin, ether runs on an underlying technology called Ethereum. Traders have been forced to look to other cryptocurrencies to invest in by a recent rally in bitcoin where each blockchain – or decentralized ledger – has their own property.
According to price tracking website CryptoCompare, the price of one ether hit a high of just over $30 on Monday and later fell to $28.26. Compared to just a week ago on March 6, this marks a roughly 20 percent rise in price. And a rise from $1.8 billion to more than $2.57 billion has been seen in the market cap of Ethereum in that period.
Traction among big corporates for the underlying technology Ethereum is one major reason for the rally in ether. In order to connect large companies to technology vendors in order to work on projects using the blockchain, an organization called the Enterprise Ethereum Alliance was recently set up.
JP Morgan, Microsoft and Intel are among the companies involved in the launch. According to Aurélien Menant, founder and CEO of Gatecoin, a blockchain assets exchange based in Hong Kong, this requires ether to be transferred and stored in order to access applications using Ethereum even though this has also added legitimacy to the cryptocurrency.
"This provides more reason to value ether at a higher price than its recent levels," Menant said.
In comparison, in the case of alternative digital currency bitcoin, one bitcoin is worth about $1,235 and a market capitalization of over $20 billion. But it has had a chance to mature and has been around for longer. But managing to hit a $2 billion market cap as the only cryptocurrency other than bitcoin is ether. In comparison, according to price tracking website Coinmarketcap.com, while Monero is worth $248 million, alternative digital currency Dash has a market capitalization of $556.9 million.
The market was watching a key decision last week which did not go the way traders wanted even as some experts have suggested that bitcoin could hit $3000 this year. A request by Cameron and Tyler Winklevoss to list a bitcoin exchange-traded fund on the market as rejected by the U.S. Securities and Exchange Commission on Friday. It would have brought more investors into the bitcoin market and would have been the first product of its kind.
However ether has been supported by the bitcoin rally.
"With the recent bull run on bitcoin due to the anticipation of the SEC decision on the bitcoin ETF, traders had more bitcoin purchasing power that they could use to exchange for other blockchain assets such as ether. With the ETF rejection, ether benefitted from this liquidity spillover, as traders saw more value in exchanging bitcoin for another cryptocurrency, with long-term promise, rather than fiat," Menant said.
(Source:www.cnbc.com)
Run on a different blockchain to the one that powers bitcoin, ether runs on an underlying technology called Ethereum. Traders have been forced to look to other cryptocurrencies to invest in by a recent rally in bitcoin where each blockchain – or decentralized ledger – has their own property.
According to price tracking website CryptoCompare, the price of one ether hit a high of just over $30 on Monday and later fell to $28.26. Compared to just a week ago on March 6, this marks a roughly 20 percent rise in price. And a rise from $1.8 billion to more than $2.57 billion has been seen in the market cap of Ethereum in that period.
Traction among big corporates for the underlying technology Ethereum is one major reason for the rally in ether. In order to connect large companies to technology vendors in order to work on projects using the blockchain, an organization called the Enterprise Ethereum Alliance was recently set up.
JP Morgan, Microsoft and Intel are among the companies involved in the launch. According to Aurélien Menant, founder and CEO of Gatecoin, a blockchain assets exchange based in Hong Kong, this requires ether to be transferred and stored in order to access applications using Ethereum even though this has also added legitimacy to the cryptocurrency.
"This provides more reason to value ether at a higher price than its recent levels," Menant said.
In comparison, in the case of alternative digital currency bitcoin, one bitcoin is worth about $1,235 and a market capitalization of over $20 billion. But it has had a chance to mature and has been around for longer. But managing to hit a $2 billion market cap as the only cryptocurrency other than bitcoin is ether. In comparison, according to price tracking website Coinmarketcap.com, while Monero is worth $248 million, alternative digital currency Dash has a market capitalization of $556.9 million.
The market was watching a key decision last week which did not go the way traders wanted even as some experts have suggested that bitcoin could hit $3000 this year. A request by Cameron and Tyler Winklevoss to list a bitcoin exchange-traded fund on the market as rejected by the U.S. Securities and Exchange Commission on Friday. It would have brought more investors into the bitcoin market and would have been the first product of its kind.
However ether has been supported by the bitcoin rally.
"With the recent bull run on bitcoin due to the anticipation of the SEC decision on the bitcoin ETF, traders had more bitcoin purchasing power that they could use to exchange for other blockchain assets such as ether. With the ETF rejection, ether benefitted from this liquidity spillover, as traders saw more value in exchanging bitcoin for another cryptocurrency, with long-term promise, rather than fiat," Menant said.
(Source:www.cnbc.com)
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