MENU

Why the Ethereum (ETH) price jumped 20% higher

It hasn’t just been the Australian share market bouncing back today, cryptocurrencies have made an almighty comeback as well. And few more so than the world’s second-largest cryptocurrency Ethereum (ETH).

At the time of writing the Ethereum price is up 20% over the last 24 hours to US$735.01, according to Coin Market Cap. This gives ETH a market capitalisation of US$71.6 billion.

It isn’t the only cryptocurrency posting notably strong gains today. Seven out of the top ten cryptos are currently at least 20% higher than this time yesterday as trader sentiment turns positive.

This includes a 20% gain by Cardano (ADA), a 41% push higher by NEO (NEO), and a 23% increase by Stellar Lumens (XLM). Bitcoin (BTC) has been a bit of a laggard with a 17% move higher US$7,362.

What has changed?

Today’s gains appear to be related to news out of the U.S. Commodity Futures Trading Commission (CFTC) this morning.

According to a press release by the Senate Banking Committee, J. Christopher Giancarlo, chairman of the CFTC, told the Committee that the emergence of cryptocurrencies was similar to the rise of the internet in the 1990s.

He concluded that:

“We are entering a new digital era in world financial markets. As we saw with the development of the Internet, we cannot put the technology genie back in the bottle. Virtual currencies mark a paradigm shift in how we think about payments, traditional financial processes, and engaging in economic activity. Ignoring these developments will not make them go away, nor is it a responsible regulatory response. The evolution of these assets, their volatility, and the interest they attract from a rising global millennial population demand serious examination. With the proper balance of sound policy, regulatory oversight and private sector innovation, new technologies will allow American markets to evolve in responsible ways and continue to grow our economy and increase prosperity.”

What does this mean?

I believe traders are interpreting this as a sign that U.S. regulators won’t ban cryptocurrencies altogether, but rather look to develop policies that regulate them and allow them to flourish.

Whilst this certainly would make them a far better investment proposition in the future, I wouldn’t necessarily be rushing in to buy them just yet and suspect that the next few days of trade could continue to be highly volatile.

The Richest Man Alive Invests in This

The richest man in the world has just launched a $100 million investment fund and investors who don't take note could miss out on a massive opportunity.

And it isn't by sheer luck. He did it by looking to the future and investing in the big ideas of tomorrow.

This could be your chance to get in on the ground floor!

Click here to discover more!

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!