Ethereum hits new all-time high, bitcoin nears record as cryptocurrencies rally

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Ethereum cryptocurrency representation can be seen in this illustrative photo taken in Sulkowice, Poland on August 12, 2021.
Jakub Porzycki / NurPhoto | Getty Images

Cryptocurrencies start the week on a positive note.

Ether, the world’s second largest digital coin, jumped more than 4% in 24 hours on Monday to a new all-time high above $ 4,700. The token was last traded at a price of $ 4,740, according to data from Coin Metrics.

Ether is the cryptocurrency of the Ethereum blockchain. In the crypto market, the terms ether and ethereum are often used interchangeably.

Bitcoin, meanwhile, climbed 7% to a price of $ 66,250, returning to a record high above $ 66,900 set in late October.

The reason for the move was not clear. Cryptocurrencies are known for their volatile price swings, with moves up to 20% up or down relatively common.

Mikkel Morch, executive director of crypto hedge fund ARK36, said that a price of $ 70,000 for bitcoin “now appears to be imminent.”

“It is important to note that the rise does not appear to be due to leverage but rather results from increased demand in the spot market where there is currently very little cash on the sell side,” Morch said in a statement. note sent by email on Monday.

Challenge

This comes against a backdrop of growing craze for DeFi, or decentralized finance, a new trend in the crypto market that seeks to create financial applications such as lending and trading on the blockchain.

Ethereum is a key player in DeFi. Some of the larger DeFi services, including the decentralized exchange Uniswap and the Aave lending platform, run on the Ethereum network.

Yet DeFi has recently gained the attention of regulators and experts have warned that a crackdown is imminent.

Read more: Ethereum price rises after Elon Musk confirms he owns the cryptocurrency

Ethereum is also the backbone of many non-fungible tokens, or NFTs, which look like digital receipts that keep track of ownership for rare items like line art.

They experienced a boom in business this year, with a token auctioned off at Christie’s for a record $ 69 million.

Still, Ethereum faces stiff competition. Rival tokens like solana and cardano have increased in price this year.

Ethereum 2.0

Ethereum is undergoing a major upgrade that investors say will make the network faster and more environmentally friendly.

Bitcoin and other cryptocurrencies have been criticized for their increasing consumption of energy.

The final step in the Ethereum network overhaul came at the end of last month, when an upgrade called Altair went live.

Meanwhile, bitcoin hit a new all-time high of nearly $ 67,000 last month, following the listing of the first U.S. bitcoin futures exchange-traded fund.

Crypto bulls hailed the move as another sign of the growing acceptance of digital assets on Wall Street.

Alternative digital currencies often recover after significant increases in the price of bitcoin, as investors seek returns elsewhere in the market.


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