The ethereum price crossed $1,000 on Thursday, marking yet another historic milestone for the third-largest cryptocurrency.
Only four days have been marked off on the calendar, but January has already been a banner month for the altcoin markets. In this brief span, the combined value of altcoin market caps has swelled by more than $140 billion, and altcoins now account for more than two-thirds of the cryptocurrency market cap. Earlier this week, ripple became the first altcoin to achieve a $100 billion market cap, and ethereum now appears poised to add its name to this exclusive list.
Like most cryptocurrencies, ethereum has been on an extended rally since the beginning of December, when it was priced at $428. Over the course of the month, the ethereum price rose by 76 percent -- even as bitcoin endured a moderate decline -- and it ended the year at $752.
Despite dropping behind a surging ripple, ethereum extended its rally into 2018, breaking through both $800 and $900 earlier in the week. This afternoon -- at approximately 14:00 UTC -- the ethereum price achieved a historic milestone, ripping past the $1,000 mark for the first time in its history.
Ethereum now has a market cap of $98.1 billion, placing it within reach of becoming the third cryptocurrency to achieve a $100 billion market cap.
Although ethereum has yet to reach $1,000 on most Western exchanges, South Korean traders have bid the price of ether up to $1,322, allowing its global average to extend into four-digit territory. At present, a plurality of ETH trading is concentrated on Binance, which accounts for more than 20 percent of daily ETH volume.
Although ethereum's march past $1,000 occurred against a backdrop of a wider altcoin surge, at least a portion of its movement is likely tied to the announcement that the Casper consensus algorithm had entered alpha testing, complete with a public testnet, paving the way for the network to transition from proof-of-work (PoW) to proof-of-stake (PoS).
Though Casper is far from reaching a production release, the fact that it has entered alpha testing is bullish for the ethereum price. Ethereum's developers believe Casper will bring a host of benefits to the ethereum network, not the least of which is the ability to dramatically reduce its inflation rate.
This will be possible because PoS requires far less electricity than PoW, incentivizing network participants to validate transactions for lower rewards than are currently distributed to miners.
The reduced inflation rate will make individual currency units more valuable and, over time, potentially allow the network to reach a deflationary state in which fewer coins enter circulation than are lost or destroyed.
Write to Josiah Wilmoth at josiah.wilmoth(at)ccn.com.
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