It’s not just Bitcoin anymore. Digital currencies have another big winner now, Ethereum (ether), and as Lombardi Letter’s Benjamin Smith explains below, it’s more than just good news for early investors.
Ethereum topped $300 for the first time this morning, increasing its relative share of the cryptocurrency market notably (as Bitcoin’s market share drops below 50%).
Source: WorldCoinIndex.com
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Source: CoinMarketCap.com
The Ethereum price explosion ultimately signals digital currencies aren’t just flash-in-the-pans; they are morphing into legitimate alternative assets nudging their way into the mainstream.
Arguably, the biggest proof of cryptocurrency transcendence has been the upswing in institutional involvement. This is the “smart” money that generally calls trends correctly. It’s one thing for mom & pops investors to move the needle higher in a limited way, as was the case with early adopters. It’s quite another for price and volume to skyrocket in an unmistakable fashion due to billions in cash infusions by institutional investors. Beyond the obvious price appreciation, institutional participation also signals a deeper confirmation of the long term viability of the asset. It tells us all those multinational and governmental pilot projects worldwide are yielding positive results.
Early indications of a powerful surge in capital flows could be seen back in March 2017. Vice president for Genesis Global Trading, Martin Garcia, noted that they “started to see institutional investor interest pick up in ethereum, something we hadn’t really seen before.” While other industry gatekeepers noted high-net worth trading in ethereum has picked up considerably. (Source: Ethereum’s Price Surge is Sparking Institutional Investor Interest, coindesk, March 17, 2017)
