Cryptocurrency Ethereum is crashing

LONDON — Ethereum’s price crash has extended to a second day, with the cryptocurrency down more than 15% in early trade on Tuesday.

Ethereum and bitcoin have both rallied strongly since the start of the year, with Ethereum rising over 5,000% from around $US8 in January to a high of over $US400 on June 13. The cryptocurrency has been boosted by the rise in popularity of so-called “Initial Coin Offerings” — a money-raising method that uses Ethereum’s network.

However, Ethereum fell around 10% on Monday amid talk of a potential price bubble. It is down just over 15% against the dollar to $ at 8.47 a.m. BST (3.47 a.m. ET):

Mati Greenspan, a market analyst with trading platform eToro, said in an email on Tuesday morning: “This is by now by far the largest pullback the cryptomarket has ever seen. If not by percentage than certainly by market cap.

“The total market cap of all (812) digital assets, as reported coinmarketcap.com has come from a peak of $US116.5 Billion in mid-June all the way down to less than $US78 Billion today.”

Bitcoin is relatively stable on Tuesday morning, down 0.67% against the dollar to $US2,328.97 at 8.57 a.m. BST (3.57 a.m. ET).

Ethereum was set up in 2014 by a group of programmers who wanted to tweak the system that runs bitcoin. Ethereum is an open source network that allows people to write “smart contracts” on it. Ethereum is powered by the cryptocurrency Ether, which is traded on the network and exchanged as a store of value.

Get the latest Bitcoin price here.

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