Smaller digital coins soar as bitcoin powers on towards record high

LONDON: Digital currencies Ethereum and XRP soared on Monday, gaining momentum as bitcoin powered on towards its all-time high.

Ethereum, the second largest cryptocurrency by market capitalisation after bitcoin, jumped 7per cent to its highest since June 2018, taking its gains to more than 25per cent over the last three days alone.

Traders said ethereum, which often moves in tandem with bitcoin, has been boosted by growing demand ahead of an upgrade to its blockchain network - due in early December - that is widely expected to make it quicker and more secure.

Third-biggest coin XRP soared 15per cent to its highest in two years, taking gains to more than 75per cent over the last three days. Traders said there was no immediate news catalyst for its jump on Monday.

The price of these so-called altcoins is closely tied to bitcoin. Less liquid than their bigger cousin, they tend to suffer from even greater volatility than the original cryptocurrency.

Bitcoin has risen around 10per cent in the last week, and was last trading at US$18,347, its all-time high of US$19,666 in sight.

It has gained about 160per cent this year, fuelled by a demand for risk-on assets, a hunger for assets perceived as resistant to inflation, and expectations it will achieve greater mainstream use.

(Reporting by Tom Wilson; Editing by Kirsten Donovan)