Key takeaways:
- Ethereum sets a new all-time high by jumping more than 4% to reach $4,700 in only 24 hours.
- Bitcoin increased by more than 4%, reaching $66,170.
- Cryptocurrencies are famous for their extreme volatility, with price fluctuations of up to 20% higher or lower being very common.
As cryptocurrencies rode a wave of momentum, flows, positive news, and inflation concerns, Bitcoin soared to near its all-time high on Monday while Ether rose to a new high.
Ethereum sets a new all-time high and gained more than 4% in 24 hours on Monday to a new all-time high of $4,700. According to Coin Metrics statistics, the token was last trading at $4,740.
Bitcoin surged more than 4% to $66,170, approaching the all-time high of $67,016.50 set on Oct. 20, while ether, the cryptocurrency that supports the ethereum network, hit a new high of $4,768.07.
As investors prepare for inflation, falling real rates make assets like gold and cryptocurrencies that don’t pay a coupon more appealing, according to Kyle Rodda, an analyst at broker IG Markets, who added that the sentiment in the sector has been positive. It was unclear why the move was made. Cryptocurrencies are renowned for their extreme volatility, with price fluctuations of up to 20% higher or lower being usual.
“Financial institutions want to be a part of it. So regulators don’t want to clamp down on it too much,” he said. “We’re almost past the inflection point, where it’s part of the system, and it’s going to be very, very hard to extricate it.”
A $70,000 price for bitcoin currently “seems imminent,” according to Mikkel Morch, executive director of crypto hedge fund ARK36.
“Importantly, the uptick doesn’t seem to be leverage-driven but rather results from the increased demand on the spot market where there’s currently very little sell-side liquidity,“ Morch wrote in an emailed note Monday.
Defi and Ethereum 2.0:
It comes as interest in DeFi, or decentralized finance, grows in the crypto market, a new movement that aims to construct financial applications like lending and trading on the blockchain.
Ethereum is a crucial component of DeFi. The Ethereum network is used by some of the most popular DeFi applications, such as the decentralized exchange Uniswap and the lending site Aave.
Ethereum is undergoing a big update that investors hope will make the network quicker and greener.
Late last month, the Ethereum network took another step forward with the launch of the Altair update.
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