Ether tops ripple to reclaim second spot in rankings as cryptocurrencies slide

Ether has reclaimed the title of the world's second-largest cryptocurrency by market value.
Ether has reclaimed the title of the world's second-largest cryptocurrency by market value. PHOTO: REUTERS

NEW YOR (BLOOMBERG) - Is it a comeback or a flippening?

Ether has reclaimed the title of the world's second-largest cryptocurrency by market value. Ripple had a short-lived stint after surging past the digital coin for the ethereum network 10 days ago, but has slipped in the rankings after falling more than 14 per cent. The decline was initially spurred by an announcement last week that Coinbase wouldn't list any new coins such as ripple on its online exchange.

Ether now boasts a market cap of just over US$111 billion, while ripple's value has shrunk to about US$98 billion, according to Coinmarketcap.com. The website began on Tuesday (Jan 9) to exclude pricing data from Korean exchanges, which helped cause ripple to tumble as much as 31 per cent, bringing its value more in line with data sites such as Bitstamp.net.

Demand for cryptocurrencies in Korea has been large enough to cause distortion on some prices. Ripple surged to almost US$4 on some Korean exchanges, while it traded at around US$2.50 elsewhere.

Bitcoin remains by far the world's largest cryptocurrency, with a market capitalization of about US$255 billion.

The switch could once again add fuel to the "flippening" fire, which is what ether enthusiasts call the coin's anticipated rise to overtake bitcoin and become the largest crypto coin. Ether's pursuit seemed foiled just last week as ripple's value climbed as high as US$140 billion, but the most recent twist in the saga could restore hope that yet another flip is coming.

Regulators in China and South Korea are increasing oversight on cryptocurrency trading and mining, while the US Securities and Exchange Commission late last year started cracking down on some digital token sales, known as ICOs.

Coinmarketcap.com's decision to exclude Korean pricing data for coins helped create the appearance of a large drop in prices, which some traders attributed as playing a part in the selloff.

"News on the regulatory front is dragging down cryptos," said Gabor Gurbacs, director of digital-asset strategy at VanEck Associates Corp. "South Korea and China tightening is weighing on bitcoin and in the ICO market, things started slowing down, with the SEC cracking down on illegal offerings."

Bitcoin slumped as much as 17 per cent to US$14,820, the most in more than two weeks. The rout in bitcoin is part of a broader selloff in the cryptocurrency realm, with all of the top 10 by market cap falling, and most tumbling by at least 10 per cent, according to Coinmarketcap. Cardano fell 16 per cent, while litecoin slumped as much as 16 per cent to as low as US$230.

Bitcoin is now little changed this year after surging about 1,400 per cent in 2017.