Bitcoins have led the cryptocurrency market to soar in the past few weeks with the total value of the combined digital assets adding $150 million.
With Bitcoin price reaching at $18,603, about to touch its 2017 all-time highest record value, the smaller digital currencies like Ethereum and XRP soared to massive gains of an all-time high in the past day.
Ethereum, the world’s second-largest cryptocurrency and most-actively used blockchain by the increase in Bitcoin market value has surged 7 percent to touch its highest value since 2018 with more than 25 percent gains earned in the last three days.
Traders say that Ethereum, which often moves back-to-back with bitcoin, has surged in value due to the increase in demand ahead of an upgrade to its blockchain network which will make it more secure is expected to come in early December.
The co-founder of cryptocurrency exchange DeversiFi, Mr. Ross Middleton says that “the upgrade could mean more people and businesses can use Ethereum for economic activity, rather than just financial trading.”
Like Bitcoin, Ethereum is highly popular among speculative traders and it has only gained little mainstream use.
The third-biggest coin Ripple’s XRP has jumped 22 percent to touch its highest value in the past two years. In the past three days itself, it has climbed to 75 percent, however, two traders stated that there was no immediate news catalyst for its jump.
The value of these digital coins are closely tied to bitcoin with less liquid than its bigger counterparts and they tend to suffer from even greater volatility than the original cryptocurrency.
“Bitcoin skyrocketed, profits were taken, profits went back into altcoins,” said Joseph Edwards, head of research at crypto brokerage Enigma Securities.
Smaller coins have rallied as crypto investors took gains from bitcoin’s stunning recent rally, which has given it around a 10 percent increase in the past week.
The sudden surge in the Bitcoin value is fueled by a demand for risk-on assets amid unprecedented stimulus measures to fight the difficulties that came from the COVID-19 pandemic.
Experts suggest that, even though the coronavirus pandemic prevents families from gathering to the same extent as they did pre-Covid-19 during the holidays, the previous history of the US markets suggests the coming Thanksgiving will push the Bitcoin and other digital currencies value sharply higher.