The digital currency Ether reached a record on Monday a day after Bitcoin breached $34,000 for the first time as the surge in cryptocurrencies continues.
Ether touched a high of about $1,010, its first foray past $1,000, following a 30 per cent surge on Sunday. Bitcoin held onto most of its weekend gains, dipping about 1.5 per cent as of 10:40am on Monday in Tokyo to $33,069. The largest cryptocurrency eclipsed its 2017 record late last year and only hit $20,000 for the first time in the middle of December.
Proponents of Bitcoin argue that it’s muscling in on gold as a hedge against US dollar weakness and inflation risk, citing evidence of growing interest among institutional investors. Sceptics view the digital asset’s more than 300 per cent surge over the past year as a risky bubble fueled by investors chasing the momentum in cryptocurrency prices.
“The drivers of the crypto rally, if anything, are strengthening amid still low interest rates, political uncertainty” and the prospect of more government stimulus, Julian Emanuel, chief equity and derivatives strategist at BTIG, said in an email. But he added that volatility can work both to the upside “as well as to the downside”.