- Chainlink’s link climbed 18% to reach a high of $36.35, the highest since May 19.
- XRP, dot and litecoin also posted gains.
- Investors have been piling into altcoins because they are cheap and have smart contract capabilities.
Link, bitcoin cash, XRP, dogecoin, dot and litecoin soared to new multi-month highs on Monday as investors opted for cheaper alternatives to bitcoin whose networks can support decentralized finance applications and smart contracts, analysts said.
A smart contract is a piece of code that allows people to enter into financial agreements without the need for a centralized player like a commercial bank or broker.
Thanks to their ability to run smart contracts, blockchain networks like ethereum have been able to do more than just host cryptocurrencies. They can include different layers of software, host non-fungible tokens and more. The bitcoin network is slower, more expensive to use and generally does not handle this type of application.
Bitcoin is still the largest cryptocurrency by market value by a long way. But it’s lagged behind some of the smaller tokens in recent weeks.
“What makes bitcoin less popular is its high cost and its enclosed nature when compared with that of ethereum and other smart contract-enabled altcoins,” Yuriy Mazur, head of data analytics department, CEX.IO broker, said.
“The crypto community believes altcoins can go up 5x or even 10x over the next several months, while Bitcoin will slowly grind higher,” Edward Moya, senior market analyst at OANDA said.
Link climbed the most by as much as 18% over the previous 24 hours to reach a session high of $36.35 – its strongest since May 19 – and was last up 6.8% at $35.79, compared with a gain of 1.65% in bitcoin, according to Coinmarketcap. The coin has rallied 45% in the last month, compared with a 15% rise in bitcoin.
“At this pace, we can see the digital token rise to $50 in approximately 14-21 days. We can face correction along the way, but the growth surge is more likely at this time,” Mazur said.
Chainlink underpins the link token and offers smart contracts much like the ethereum network. The company said in a tweet last week that a record 76 new integrations took place on the network in August, bringing the total to 755. on any blockchain like ethereum.
“It seems that the demand for chainlink is growing, as well as its utility,” Mazur said.
“Additionally, the growth recorded in the past month has highlighted the relevance the token has continued to print, extending its lead as the first network to allow the integration of off-chain data into smart contracts,” he added.
Ether was last up around 0.6% at $3943, while other coins like XRP rose almost 8% to $1.37, and polkadot’s dot was up about 2.0% at $34.25.
Cardano’s ada hit record highs last week ahead of this month’s “alonzo” network upgrade, but lagged the rest of the crypto complex, easing by 0.4% to around $2.856.
“Now amongst the favorites of crypto enthusiasts are ethereum and cardano, which have shown impressive results lately and are going through the era of hard forks. Ethereum has already had an update, and a cardano update is coming,” Mazur said.