Cryptocurrency ethereum climbed to a new peak for a third straight day on Monday on continued optimism about further growth in decentralized finance or "DeFi"
By Gertrude Chavez-Dreyfuss, Tom Wilson, and Tom Westbrook
NEW YORK/LONDON/SINGAPORE (Reuters) -Cryptocurrency ethereum climbed to a new peak for a third straight day on Monday on continued optimism about further growth in decentralized finance or "DeFi", although some analysts said it was overvalued at current levels.
Ethereum has soared this year, fuelled by the boom in DeFi, which are platforms that facilitate crypto-denominated lending outside traditional banking. Many DeFi applications are embedded in the ethereum blockchain.
Ethereum, the second-largest coin by market capitalization, hit an all-time high of $4,200 and was last up around 5.2% at $4,133.40.
"The myriad possibilities of decentralized ledger technologies should be likened to a technological force of nature that will continue to disrupt finance and other businesses," said Paolo Ardoino, chief technology officer of cryptocurrency exchange Bitfinex.
An upcoming technical change to its software seen as reducing its supply has also provided a boost, while new institutional investors in the crypto sector have warmed to it amid a tepid quarter so far for bitcoin.
"(Crypto has) got a lot more institutional involvement than people who haven't followed the market believe," said Chris Weston, head of research at brokerage Pepperstone.
But some analysts said ethereum's increasing valuation was not underpinned by data of how widely it is used.
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