If you’ve spent any time reading crypto news, you’ve probably noticed that the two main cryptocurrencies that are getting attention are bitcoin and ether.
The latter is currently trading at a record high.
However, it’s clear that the current boom in the two markets has had a massive impact on the markets valuation.
A new report from Bloomberg claims that there is a significant gap between the price of bitcoin and the market price of ether.
Bloomberg explains: “Ether, the world’s second-largest cryptocurrency, surged to $1,800 on Monday as investors raced to get in on the action.
That price was far higher than the $1.35 it fetched earlier this week, after the digital currency gained $5.7 billion in market value from Aug. 3 through Sept. 30.
Ethereum’s price rose to $3,000 on Monday, while bitcoin’s was just $4,817.
Ether and bitcoin are two different cryptocurrencies.
The difference between the two is the amount of ether being traded.
While bitcoin is trading at an average of $1 billion, ether is trading for about $5 billion.
The gap between bitcoin and Ether has led to the valuation of both cryptocurrencies, according to the Bloomberg report.
Bloomberg says that it found that, over the past three months, ether’s price has increased by more than 7.5% over the previous 12 months, while that of bitcoin has declined by more that 7.2%.
Bloomberg notes that ether’s value is up by more by an average $2,000 a month, while its price has decreased by an equivalent $6,000.
“The crypto-token is the new gold, as it is the currency of choice for those who want to invest in new assets like bitcoin.” “
Ethereum’s rise in value is driven largely by investors’ enthusiasm about the cryptocurrency, a phenomenon the cryptocurrency’s creators say is driven by a mix of investor interest and technical innovation,” Bloomberg writes.
“The crypto-token is the new gold, as it is the currency of choice for those who want to invest in new assets like bitcoin.”
A recent report from CoinDesk found that there’s also a significant amount that is being created on both the Bitcoin and Ethereum markets.
According to the report, the Ethereum ecosystem has experienced a surge in the number of new tokens, with nearly half of all ether tokens being created.
The cryptocurrency’s market cap is up more than 40% this year.
Bloomberg also claims that, although ether is currently in the midst of a massive rally, there’s an argument to be made that ether is still a “short term” play.
While the report does note that Ethereum is still on a downtrend, it also says that the Ethereum platform will eventually gain some traction and that this will be driven by the adoption of more complex financial products.
“It’s going to take a long time for Ethereum to truly become a legitimate financial product, because its design has to be robust enough to support multiple users and markets, but the smart contract technology is good enough to make it possible,” the report says.
“But the technology is there and it’s getting better.
I don’t see any reason why the price would go back to $4 or $5 anytime soon.”
What do you make of the report?
Let us know in the comments below.
Images courtesy of Shutterstock, Bloomberg, and Bloomberg