Ethereum cracks R40k, hits another all-time high
By way of historical comparison, bitcoin smashed through R40 000 in July 2017 before rallying to more than R300 000 before the end of that year.
The latest price surge comes after the listing of a batch of exchange-traded funds on the Toronto Stock Exchange in Canada. Image: Akos Stiller, Bloomberg
Ethereum, the second biggest cryptocurrency by market cap after bitcoin, hit a new all-time high this week when it cracked R40 000.
Earlier in the month another milestone was reached – ether (ETH), the name of the Ethereum network’s currency, blew past the 1o ounce Krugerrand (currently worth about R26 200).
Price-surge push
The latest push behind ether’s price surge comes after the listing of a batch of ETFs (exchange-traded funds) on the Toronto Stock Exchange, which now makes it possible for institutional and high-net-worth individuals to invest indirectly in funds such as the CI Galaxy Ethereum ETF (ETHX).
Many investment funds are prohibited from directly owning cryptocurrencies, but are allowed to invest in companies that hold cryptos like bitcoin and ETH.
The first ether ETF to be launched was the Grayscale Ethereum Trust, which tracks the ETH market price, less fees and expenses.
Another reason behind this week’s price surge is the overcoming of some technical obstacles to the expansion and smooth running of the Ethereum network in a series of upgrades called ETH 2.0.
Ether has been gaining in strength against bitcoin since the start of 2021.
These two cryptocurrencies have entirely different use cases: bitcoin is seen as a store of value because of its hard cap of 21 million coins that will ever be minted, while the Ethereum network allows developers to build applications that can generate revenue in a variety of different ways. There are currently 115 million ETH in circulation, a figure hard-coded to increase by 12 million a year.
Will the rise continue?
AltCoinTrader CEO Richard da Sousa sees Ethereum at R50 000 in the near future.
Some analysts are cautious of the parabolic rise of cryptocurrencies, but others are not so sure, arguing that Ethereum remains undervalued and could hit $3 000 (around R42 740) in the next few months.
Some even see it at $10 000 (close to R142 500) in the next two years.
Prominent investor Raoul Pal sees a price potential of $20 000 for Ethereum, while Mark Cuban likens the current run in cryptos to the internet bubble. In January he tweeted that cryptocurrencies like ether, bitcoin and a few others will be analogous to those tech companies built during the dot.com era that survived the bubble and went on to thrive. Other cryptocurrencies may not be so lucky.
This story first appeared on Moneyweb and has been republished with permission.
