Ethereum Classic Surges 19% to $14 Ahead of Coinbase Consumer Listing

Francisco Memoria
  • Ethereum Classic recently surged thanks to an announcement from Coinbase, revealing it'll be listed on Coinbase Consumer later today.
  • The cryptocurrency is now trading at little over $14, far from its $47 all-time high.

Ethereum Classic (ETC) has recently surged over 19%, shortly after the popular San Francisco-based cryptocurrency exchange Coinbase announced its adding it to Coinbase Consumer. Its users will be able to buy the cryptocurrency on its website and mobile app later today, August 16.

As CryptoGlobe covered, Coinbase announced it would add support for Ethereum Classic earlier this year, at about the same time leading exchange Binance added ETC trading pairs. The result was a 20% price surge.

Earlier this month Coinbase revealed it was in a final testing phase before adding support for the cryptocurrency, which helped its price surge to a three-month high of $21. The cryptocurrency’s all-time high, reached back in January of this year, came close to $47.

Shortly after Coinbase’s announcement, commission-free trading app Robinhood also revealed it was adding support for ETC, which further helped its price reach the $21 mark, before enduring a small correction and seeing today’s surge.

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Whenever a cryptocurrency is added to Coinbase, it’s price usually surges in what has become known as the “Coinbase effect” – currently affecting ETC. The effect is partly caused by the added liquidity the firm brings, provided by its over 13 million users. Recently, its CEO revealed it was adding 50,000 users a day last year. Notably last year, when the San Francisco-based exchange added Bitcoin Cash (BCH), the cryptocurrency’s price surged ahead of its official announcement.

At the time most believed someone leaked the information, meaning the price pump was a result of insider trading. Recently an internal investigation found there was no insider trading ahead of BCH’s listing.

While ETC is the latest cryptocurrency Coinbase is supporting, the exchange has revealed it’s considering various tokens. As covered, the company announced it’s looking into Cardano (ADA), Basic Attention Token (BAT), Stellar Lumens (XLM), Zcash (ZEC), and 0x (ZRX).

In a subsequent blog post, Coinbase revealed its institutional custody service, Coinbase Custody, is exploring a range of new assets as well, including Ripple’s XRP, NEO, XMR, and EOS. The company recently made its Index Fund more attractive by halving its fee from 2% to 1%.

Binance Margin Borrowing Passes $100 Million Mark Since July

Neil Dennis

Since Malta-based crypto exchange Binance first offered lending in July, as much as $100 million in cryptocurrency have been borrowed, the company announced in a Twitter post.

The company offers margin lending - which enables lenders to earn interest on cryptocurrency during the term of the loan - on 21 different cryptoassets.

The company announced earlier this week that it was adding margin trading options for two additional cryptoassets: dash and zcash. Binance also announced it would include dash among the assets it allows customers to lend over the exchange. The ability to lend and borrow cryptocurrencies on an exchange helps increase their liquidity, thus, eventually reducing price volatility.

Dangers of Margin Trading

Margin trading in cryptocurrencies has been broadly criticized as leveraged trades amplify potential gains, but also risk increasing potential losses. Given the volatility in the cryptoasset market in recent years, the Bank of England would like to ban the trading of highly-leveraged products to reduce the exposure of retail investors to huge losses.

Altcoins, such as dash and zcash, are more volatile than the better capitalized tokens such as bitcoin and ether as they lack liquidity on exchanges - meaning that because trading in them is so light and infrequent, large price swings can be generated by relatively small block-trades.