Photographer: Tomohiro Ohsumi / Bloomberg
Photographer: Tomohiro Ohsumi / Bloomberg
Bitcoin’s recent swings have turned the cryptocurrency spotlight on other digital currencies, including Ether, whose gains this year surpassed the performance of its bigger rival.
The world’s largest cryptocurrency rose 2.5% in London to $ 37,154.02 at 9:58 a.m. in London after major upheavals earlier in January. The relative calm of recent times may encourage crypto enthusiasts to chase the momentum in coins such as Ether, which is up 87% in 2021 compared to Bitcoin’s 28% advance.
“Bitcoin has been in range for the past few weeks, giving time for capital to rotate” to other digital assets, said Vijay Ayyar, head of business development at crypto exchange Luno in Singapore.
There are many questions about the causes of Bitcoin’s parabolic surge to nearly USD 42,000 on Jan. 8, before a sharp downturn occurred. A Research by Bloomberg Economics suggests that animal spirits are responsible for most of the move, while Bitcoin’s claimed role as a hedge against risks such as inflation is secondary.
A backdrop of incentives to counter the impact of the pandemic remains positive for Bitcoin and other cryptocurrencies, said Seamus Donoghue, vice president for sales and business development at digital infrastructure provider Metaco.
At the same time, JPMorgan Chase & Co. said that $ 40,000 is a key level for Bitcoin, indicating the risk of a further decline unless it quickly climbs back above that price. Bitcoin is down 7% from its January 8 record, increasing the likelihood of an exodus of speculative investors.
The Ethereum blockchain is popular for so-called decentralized financing and is also making progress towards one network upgrade. Commentators argue that these trends have helped Ether.
Ether climbed a whopping 13.3% to trade at around $ 1,382 as of 10:01 am in London. The Bloomberg Galaxy Crypto Index added around 13%.
– With help from Mark Cranfield and Joanna Ossinger