Bitcoin, ether extend gains to second day

Bitcoin and ether prices continued to climb on Wednesday, clawing back some of the steep declines over the holiday weekend that were sparked by China’s ban on initial coin offerings.

Last weekend, Chinese regulators declared initial coin offerings illegal and sparked selloffs in digital currencies, sending bitcoin down 13% and ether down 23%. However, buying over the past two days suggests that there is enough risk appetite to push the prices higher.

On Wednesday, one bitcoin BTCUSD, +4.26% was trading up 3.8% at $4,591, bringing its market capitalization to nearly $76 billion. Bitcoin is about 8% below its peak reached on Friday at above $5,000, according to CoinDesk.

Ether, the digital currency that trades on the Ethereum platform, was up 5.8% to $331. Ether’s market cap rose above $31 billion. Despite two-day gains, the digital currency is down more than 15% from its recent peak at $392.

Opinion: Bitcoin, Ether and other cryptocurrencies may be seeing the beginning of the end

The increasing popularity of cryptocurencies that fueled the stratospheric rise of bitcoin and ether as well as the explosion of initial coin offerings has attracted the scrutiny of regulators in the U.S., China and Hong Kong.

In a Tuesday panel discussion, Steven Peikin, co-director of the U.S. Securities and Exchange Commission’s division of enforcement, likened some initial coin offerings to “roaches,” saying they pose a threat to non-savvy investors, Reuters reported.

The SEC declared digital tokens as securities to have a better oversight over fast growing industry that raise $1.7 billion this year alone.

Investors willing to invest in bitcoin can buy the cryptocurrency directly and store it in a digital wallet from sites such as The bid to launch a bitcoin ETF failed so far. The only other available instrument—Bitcoin Investment Trust GBTC, +9.16% —is currently trading at a 130% premium to its net asset value or NAV.

GBTC, which holds 174,174 bitcoins is trading up 9% at $845. According to Grayscale, which owns the trust its value based on the prices of bitcoin less fees is at $400.

The stark discrepancy between the GBTC price and its underlying value has caught the attention of famed investor Andrew Left, who is shorting the security, calling it the most dangerous way to own bitcoin.