After catching the eye of both the Singapore government and Russian President Vladimir Putin, Ethereum—the second-biggest cryptocurrency in the world, after Bitcoin—continues to skyrocket. On Monday morning, the cryptocurrency was trading at a record-high level of $407.10, more than a 5,000 percent rise since the beginning of 2017, when it was trading at $7.98.
Ethereum’s founder, Vitalik Buterin, recently met with Putin during the St. Petersburg International Economic Forum, a signal that the country may be interested in using digital currency to move its economy beyond gas and oil. “The digital economy isn’t a separate industry, it’s essentially the foundation for creating brand-new business models,” Putin said at the forum. (Russian entities, like the state development bank VEB, have agreed to use Ethereum to help implement blockchain technology in the country). As investors look for a place to put their assets amid mounting geopolitical instability, some are turning to cryptocurrency. Singapore’s government has released a report saying it has carried out a test using ethereum blockchain technology to create a national digital currency. Regulators in Japan are issuing new rules that make cryptocurrencies like Ethereum a valid form of payment. And companies such as Toyota and Microsoft, which are members of an organization called the Enterprise Ethereum Alliance, are throwing their weight behind the cryptocurrency, too.
Ethereum, which has a total valuation of $36 billion, trails only Bitcoin (valued at $49 billion) in terms of market capitalization. Bitcoin has been rallying all year, reaching a high of above $3,000 for the first time on Sunday as a growing number of people turn to virtual currencies as a safer, faster way to exchange money. But Ethereum’s rally may still have a ways to go: Pavel Matveev, the co-founder of banking start-up Wirex, tells CNBC that Ethereum’s price could reach $600 by the end of the year.