The price of both Ethereum—the world’s second-largest cryptocurrency in terms of total market capitalization—and Bitcoin Cash—a so-called “hard fork” of the original Bitcoin—is soaring on Wednesday, despite steep declines in many other cryptocurrencies.
According to CoinMarketCap.com, Ethereum has gained about 12.8% over the past 24 hours, while Bitcoin Cash is up about 12.3% over that same timeframe. Meanwhile, Bitcoin has tumbled about 4.0%, Litecoin has shed nearly 2.5%, and Ripple has plummeted more than 16.4%.
Ethereum was actually surpassed by Ripple for second place in the cryptocurrency rankings just a few days ago, but ether’s latest surge has helped it reclaim its spot. The crypto’s run to new highs also comes in the face of several major tech issues surrounding the blockchain platform.
Ethereum has been a go-to alternative to Bitcoin because it typically offers shorter transaction wait times and lower transaction fees. However, a recent glitch in the platform’s algorithm to estimate costs has caused many users to pay significantly higher fees than usual.
In an email to CoinDesk.com, developer Nick Johnson explained that many popular wallets—including MyEtherWallet, MetaMask, and Shapeshift—use what is called a “gas oracle” to calculate transaction fees.
The gas oracle has been affected by a number of users paying more to use the Ethereum blockchain. Johnson ultimately concluded that, “while it's still possible to transact on the network at a fairly low price, the oracle started returning increasingly high estimates.”
Bitcoin Cash has also emerged as a popular Bitcoin alternative thanks to its reduced wait times and fees. Launched in August, Bitcoin Cash is hard fork of Bitcoin. A hard fork in the cryptocurrency world refers to a change in the rules of the blockchain infrastructure that is not recognized as valid by the older software. In some ways, hard forks are similar to stock splits in that they are designed, in part, to alleviate barriers to entry for new users.
These altcoins have grown in popularity for practical reasons, and now we are starting to see their prices move in the opposite direction of Bitcoin during these sudden one-day swings. It is possible that short-term traders are beginning to use Ethereum and Bitcoin Cash as a way to hedge against their Bitcoin losses.
On Tuesday, the world welcomed yet another company to the growing list of firms that have “gone crypto” by adding a new blockchain focus to their existing business model.
Indeed, shares of Kodak (NYSE:KODK) have now gained about 250% since the camera company announced that it is partnering with WENN Digital to launch a blockchain platform and cryptocurrency geared toward photographers (also read: Kodak Launches Cryptocurrency, Stock Soars).
KODAKOne, the blockchain-backed system, will function as an image rights management platform designed to give photographers an encrypted digital ledger for registering and licensing their work. Meanwhile, KODAKCoin will help photographers get paid when their content is used.
“For many in the tech industry, ‘blockchain’ and ‘cryptocurrency’ are hot buzzwords, but for photographers who’ve long struggled to assert control over their work and how it’s used, these buzzwords are the keys to solving what felt like an unsolvable problem,” said Kodak CEO Jeff Clarke.
Shares of other popular cryptocurrency proxy stocks, including Riot Blockchain (NASDAQ:RIOT) and Longfin Corp. (NASDAQ:LFIN) were in the red on Wednesday morning. Riot was down about 4.7% in early morning trading, while Longfin slipped about 4.1%.
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