Cryptocurrency Ether reached an all-time high on Friday, surpassing $ 1,700 for the first time.
Ether, the second largest digital currency in the world by market value, rose 11.2 percent to $ 1,743, according to For data From CoinDesk.
This comes after Bitcoin, the most valuable virtual currency, hit a record high near $ 42,000 last month.
Bitcoin’s price has more than quadrupled over the course of 2020, rising 29 percent since the start of 2021, while Ether is up about 129 percent annually so far.
Ether has risen steadily this week as investors await the upcoming launch of CME Ether futures next week.
Trading in ether futures is set to begin on Monday, and the Chicago Mercantile Exchange launched Bitcoin futures more than three years ago, at the height of the cryptocurrency’s rise in 2017.
And some investors believe that crypto-focused futures contracts give institutional investors more confidence to invest in this area.
Bringing in more financial instruments attracts more market participants, and this may be positive for the price of Ether, but the main driver of the price of Ether and other smaller digital currencies has been the momentum of Bitcoin in recent months.
The Ethereum network was created after Bitcoin in 2013, and the main difference between the Ethereum network and the Bitcoin network is the ability to support applications.
This move by the Chicago Mercantile Exchange may lead to further buying of ether from new market entrants as it provides a way for seasoned investors to hedge their risks against positions they may hold.
However, it should be noted that, like Bitcoin, CBE Ether futures contracts are settled in cash so that they do not include any physical delivery, so a significant impact on spot prices should not necessarily be expected.
Cryptocurrency investors said another factor likely to boost Ether is the start of a major upgrade to the Ethereum network, called Ethereum 2.0, and cryptocurrency investors hope the upgrade will make the Ethereum network faster and safer.
The total market capitalization of all cryptocurrencies combined reached $ 1 trillion last month, as the price of Bitcoin rose to record levels.
Bitcoin got a boost due to institutional demand, as well as the perception that it is an asset of comparable value to gold.
Bitcoin rose 4.7 percent in the last 24 hours, trading at $ 38,151, while XRP, the third largest digital currency, rose 10.7 percent to 44 cents.
But skeptics argue: Bitcoin and other cryptocurrencies have no intrinsic value, and a survey by Deutsche Bank found that investors see Bitcoin as the most extreme bubble in the financial markets.