Bitcoin and Ether token prices climbed on Wednesday, as both digital currencies added to recoveries from a plunge this month.
Bitcoin dropped more than 30% during the first two weeks of September in the wake of threats by Chinese authorities about closing cryptocurrency exchanges and a ban on so-called initial coin offerings, which have been deemed illegal in the region by Beijing regulators.
Opinion: Here’s a reason why China would want to shut down bitcoin
The September selloff earlier was exacerbated by negative comments from J.P. Morgan Chase & Co.
JPM, +0.70%
CEO Jamie Dimon, who described the bitcoin as “a fraud” and a bubble.
Bitcoin peaked at more than $5,000 in early September, but tumbled to a low of $2,951 last Friday.
Bitcoin experienced a 34% plunge earlier this summer, when the cryptocurrency was expected to split into two different versions following a software update known As Segregation Witness or SegWit that would speed up its network. That split created a parallel blockchain currency Bitcoin Cash.
Bitcoin is facing another split sometime in November, which would create a third version of the bitcoin that would increase its block size to 2 mega byes from the current 1MB.
Despite such extreme volatility, bitcoin prices are up more than 300% since the start of the year, compared with the Dow Jones Industrial Average
DJIA, +0.19%
and S&P 500 index
SPX, +0.06%
which are up 13% and 12%, respectively, over the same period.
A single bitcoin
BTCUSD, -0.25%
was worth about $3,987 on Wednesday with its market vale rising to $65.7 billion. Last week its value declined to as low as $59.3 billion, according to research site Coinmarketcap.com.
As digital currencies continue to recover, so do criticisms from Wall Street heavyweights and regulators.
On Tuesday, Ray Dalio, the founder of the world’s largest hedge fund, said bitcoin has all the makings of a bubble based on the firm’s criteria for the market phenomenon.
“Bitcoin is a highly speculative market. Bitcoin is a bubble,” Dalio said.
Meanwhile regulators in the U.S. are growing concerned about consumers investing in so called ICOs, a form of fundraising in exchange for tokens that can be eventually used for purchasing products of the company or traded on secondary markets. The Securities and Exchange Commission recently issued a report warning investors about the perils of ICOs, comparing them to Ponzi schemes.
Read: What is an ICO?
Meanwhile, Ether tokens, trading on the Ethereum blockchain, were also attempting to recover from last week’s decline. One Ether token was buying $289 in recent trade.
Ether’s value was at $27.4 billion, compared with a recent low at about $21.6 billion last week.
Across the broader digital-currency segment, the total market value of an array of cryptocoins was at $137.8 billion, with bitcoin representing about 52% of that value, Coinmarketcap data show.