Ether climbs another 3% after Monday’s rally, Bitcoin hits record high

Ether continued its upward march on Tuesday as the price of Bitcoin took a breather.

The second-largest cryptocurrency was last up 2.5% to $65,868, according to Coin Metrics. Earlier, it rose to $3,828.81, the highest level since January 2022. Bitcoin retreated about 3% after reaching a record high above $69,000.

“ETH has significant momentum behind it as it is widely used as a gateway to the many meme coins and DeFi platforms that are growing on the back of Bitcoin’s continued rise,” said Philip Zentner, CEO of crypto infrastructure protocol Li .Fi . “As has often happened in the past, Bitcoin’s approach to record highs has caused a trickle-down effect from adoption elsewhere in the ecosystem.”

With Bitcoin up 19% in the past week, meme coins have gained about 175% over the same period, according to CoinGecko. Analysts point to them as evidence that retail investors, who were absent for much of the recent crypto rally, are beginning to return to the crypto market.

Decentralized financial tokens also gained almost 14%, NFT coins rose 20% and the smart contract sector gained 17%. Tier 1 tokens – which include bitcoin, ether and the Solana token – are up 21% as a group.

“As capital cycles continue to turn into altcoins, it would make sense that ETH would likely continue to make gains, even if not as large as coins including the Shiba Inu coin, dogwifehat, Arbitration or others,” Zentner said.

As one of the two so-called blue-chip cryptocurrencies, Ether’s performance generally lags that of Bitcoin. Ether rose 5% on Monday, compared to Bitcoin’s 9% rise.

However, it’s also getting a boost from a batch of catalysts, including the recent rally in bitcoin and tech stocks, as well as a technical upgrade to the network this month, and the possibility that there will soon be spot ether ETFs available for trading on US ether is up 65% for year compared to Bitcoin’s 58% since its recent rally.

“Given the relative difference in market capitalization of Ether and Bitcoin, investors likely see additional growth potential in ETH versus Bitcoin in a world where both ETFs exist and are viewed collectively as an asset class that will have a continuous allocation of investment advisors and wealth managers,” said David Wells, CEO of Enclave Markets.