THE price of Ethereum is on the rise and has soared to record highs every day since the start of April.
But what exactly is Ethereum and why is it going up in value? We explain what you need to know.
2
But first, a word of warning: buying cryptocurrencies as well as stocks and shares is a very risky business.
Investing is not a guaranteed way to make money, so make sure you know the risks and can afford to lose the cash.
Cryptocurrencies are highly volatile, so your cash can go down as well as up in the blink of an eye – you can lose all the money you put in.
What is Ethereum?
Ethereum is a cryptocurrency that was released in 2015. It’s the second largest after Bitcoin.
In fact, some experts believe it has the potential to one day overtake Bitcoin as the dominant coin in the market.
5 risks of crypto investments
THE Financial Conduct Authority (FCA) has warned people about the risks of investing in cryptocurrencies.
- Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements.
- Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
- Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market.
- Charges and fees: Consumers should consider the impact of fees and charges on their investment which may be more than those for regulated investment products.
- Marketing materials: Firms may overstate the returns of products or understate the risks involved.
It was founded by eight people, one of which is 27-year-old cryptocurrency “celebrity” Vitalik Buterin.
Ethereum is also a ledger technology – using “blockchain”, like Bitcoin – that companies are using to build new programmes.
A blockchain is where encrypted data can be transferred securely, making it nearly impossible to duplicate or counterfeit.
This ledger is the foundation of any cryptocurrency transaction.
E Toro writes that cryptocurrency allows people to trade currency or assets digitally outside of any government or bank.
Why is it going up?
Ethereum has increased in value by more than 3% in the last 24 hours, according to CoinMarketCap.
It now sits at around $2,794.66 (£2,004.06), up from $2,587.08 (£1,855.07) yesterday, April 28.
2
In fact, the cryptocurrency has reached record highs every day this month.
On April 1, Ethereum started at $1,957.79 (£1,403.83) and rose to $1,978.37 (£1,418.59).
It’s not clear exactly what has spurred on this surge.
Jason Cozens, founder of fintech company Glint, said: “Ethereum’s performance to smash the £2,000 barrier for the first time is further indication that alternative currencies are now firmly established amongst consumers as a viable store of value and means of exchange.
“Consumers have had enough of being punished for saving and they’re increasingly embracing alternatives to fiat currencies that offer greater control over how they save and spend their money.”
However, Ethereum is still worth far less than Bitcoin, which today is valued at $53,974.11 (£38,702.14).
Simon Peters, cryptoasset analyst at multi-asset investment platform eToro, said: “While the more established Bitcoin is many times higher than ethereum and other coins on a dollar basis, the fact is this is an emerging asset class, and the long-term potential of coins like ethereum is clearly attracting attention.”
PAY SUPPORT
Furlough should be permanent with unemployed paid 80% of wages, says think tank
CUTTING COSTS
Law to cut the cost of school uniform to pass – and it can save parents £100s
TAXING TIMES
How to check if you’ve been paid £500 working tax credit Covid grant
LOOSE CHANGING ROOMS
£2.5m mansion could be yours for 47p – and the Beckhams are neighbours
QUIDS IN
Rare £1 coin with error on it sells for £155 – check if you have one
BOAT LIFE
Our first home is a £23k house boat – but we’re saving up for a house
Brits are being warned they risk losing all of their money if they invest in bitcoin and other cryptocurrencies.
It comes after a ban on some crypto-related investment products.
From Dogecoin and Litecoin to Bitcoin – here are the different cryptocurrencies explained.
What is the new cryptocurrency SafeMoon?
