As the value of bitcoin started to soar, it began to attract more mainstream investors and eventually caught the interest of financial professionals. Now, the same thing is happening with other digital currencies.
The latest evidence of this is Bloomberg’s decision to add prices for three other crypto-currences—Ripple, Ethereum and Litecoin—to its terminal service, which is used by major banks and investment houses worldwide.
The addition amounts to a validation of sorts for the digital currencies, which have been around for a while but have always been second fiddle to bitcoin:
While the three digital currencies rely on similar distributed ledger technology, as does bitcoin, they are quite different from one another.
Ethereum relies on a more versatile type of software that has made it a popular platform for many other digital tokens, while Litecoin is built as a quicker, more efficient clone of bitcoin. Ripple, meanwhile, is actually a private company that provides blockchain technology to banks, and allows some of its currency (known as XRP) to trade in the open market).
Ethereum saw a remarkable price jump early in the year when it suddenly soared from under $10 to around $200 in a few months, and is now trading near $700. Litecoin saw a similar but more recent price jump, while Ripple has experienced a series of surges in the last year.
The interest in these other so-called “alt-currencies” likely represents speculators looking for alternatives given how expensive bitcoin has become (it’s currently trading around $16,500).
Bloomberg declined to comment on the decision to add the new alt-currencies to the terminal, but a person familiar with the company said they were added as a feature for foreign-exchange traders.
The person added that the terminal data is drawn from prices provided by Bitstamp. The Luxembourg-based exchange is one of several platforms for obtaining digital currency in a market where price spreads can differ significantly from exchange to exchange.