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The price of ethereum (ether) has hit an all-time high after doubling in value in less than a month.
The cryptocurrency reached $1,430 (£1,044) on Tuesday, according to CoinMarketCap’s price index, having previously peaked just below $1,400 in January 2018.
It marks a remarkable come back for ethereum, which crashed to below $100 in the months following its 2018 high.
It experienced a steady recovery throughout 2020 until a sudden price surge in late December took its value from around $600 to its current record highs.
Ethereum’s resurgence comes amid a market-wide bull run that has seen major gains for most major cryptocurrencies, including bitcoin and litecoin.
Analysts have referred to the sky-rocketing prices as the 21st century gold rush, with computer-savvy entrepreneurs using high-powered machines to digitally mine the cryptocurrencies.
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The underlying technology of these digital currencies mean new units are generated by solving complex mathematical problems that require vast amounts of computing power. For example, 6.25 new bitcoins are generated every 10 minutes by this process, which is roughly the equivalent of $220,000.
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A report last year by Coherent Market Insights estimated that the cryptocurrency mining market would exceed $38 billion by 2025.
This is still only a fraction of the current value of the cryptocurrency market, which recently surpassed $1 trillion for the first time.
Bitcoin’s volatile history in picturesShow all 101/10Bitcoin’s volatile history in pictures
Bitcoin’s volatile history in picturesSatoshi Nakamoto creates the first bitcoin block in 2009
On 3 January, 2009, the genesis block of bitcoin appeared. It came less than a year after the pseudonymous creator Satoshi Nakamoto detailed the cryptocurrency in a paper titled ‘Bitcoin: A peer-to-Peer Electronic Cash System’
Reuters
Bitcoin’s volatile history in picturesBitcoin is used as a currency for the first time
On 22 May, 2010, the first ever real-world bitcoin transaction took place. Lazlo Hanyecz bought two pizzas for 10,000 bitcoins – the equivalent of $90 million at today’s prices
Lazlo Hanyecz
Bitcoin’s volatile history in picturesSilk Road opens for business
Bitcoin soon gained notoriety for its use on the dark web. The Silk Road marketplace, established in 2011, was the first of hundreds of sites to offer illegal drugs and services in exchange for bitcoin
Screenshot
Bitcoin’s volatile history in picturesThe first bitcoin ATM appears
On 29 October, 2013, the first ever bitcoin ATM was installed in a coffee shop in Vancouver, Canada. The machine allowed people to exchange bitcoins for cash
Reuters
Bitcoin’s volatile history in picturesThe fall of MtGox
The world’s biggest bitcoin exchange, MtGox, filed for bankruptcy in February 2014 after losing almost 750,000 of its customers bitcoins. At the time, this was around 7 per cent of all bitcoins and the market inevitably crashed
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Bitcoin’s volatile history in picturesWould the real Satoshi Nakamoto please stand up
In 2015, Australian police raided the home of Craig Wright after the entrepreneur claimed he was Satoshi Nakamoto. He later rescinded the claim
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Bitcoin’s volatile history in picturesBitcoin’s big split
On 1 August, 2017, an unresolvable dispute within the bitcoin community saw the network split. The fork of bitcoin’s underlying blockchain technology spawned a new cryptocurrency: Bitcoin cash
Reuters
Bitcoin’s volatile history in picturesBitcoin’s price sky rockets
Towards the end of 2017, the price of bitcoin surged to almost $20,000. This represented a 1,300 per cent increase from its price at the start of the year
Reuters
Bitcoin’s volatile history in picturesWhat goes up…
Bitcoin price crashes spectacularly, losing half of its value in a matter of days
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Bitcoin’s volatile history in picturesBitcoin plunges
The cryptocurrency eventually bottoms out below $4,000 in 2019 before slowly rebuilding momentum to outperform more traditional assets
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The market has been boosted by a variety of factors, including increased institutional investment during the coronavirus pandemic, but ethereum’s meteoric rise can largely be pegged to a resurgent decentralised finance (Defi) industry.
“While the explosion of projects in Defi has caused growing pains for ethereum, solutions are in the works that are helping the network to scale,” Paolo Ardoino, chief technology officer at leading cryptocurrency exchange Bitfinex, told The Independent.
“The launch of Tether tokens on such solutions, as a valuable and trusted source of liquidity, will help power ethereum towards its full potential.”
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