The price ether, the digital token used on the ethereum blockchain set a new record high in trading today, at just under $415. It has been a good year for the cryptocurrency, which has appreciated by a cool 5,000% (or so) since January, when it was trading at $8. So far today, the cryptocurrency has gained more than 8%.
All the ether in circulation is now worth $39 billion, compared with bitcoin’s $137 billion. The market value of all cryptocurrencies in circulation, meanwhile, has just passed the quarter-of-a-trillion mark, according to data provider CoinMarketCap.
All cryptocurrencies in circulation are valued at over a quarter of a trillion dollars. (CoinMarketCap)
As ever, the question that arises about the soaring ether price is: Why? One clue may be in a chart that has started circulating among cryptocurrency traders. It compares the number of ethereum transactions against other cryptocurrencies, with ethereum’s 534,000 transactions over the past day accounting for over 50% of all cryptocurrency trades. This suggests traction among users, which in turn suggests the demand for ether is on the rise.
Ethereum dominates in sheer volume of transactions. (BitInfoCharts)
However, transaction volumes don’t tell the whole story. Because ethereum contains a programming language that lets developers write applications that interact with its blockchain, many transactions could also be automated by programs. It’s not clear what percentage of transactions are done by bots or applications, or the significance of that data for extrapolating user adoption. In other words, and as always with cryptocurrency prices, the factors underlying the surge remain mysterious.