(Reuters)

Ether, the world’s second-largest cryptocurrency after bitcoin, on Thursday (May 6) extended a breakaway rally to a new record high of US$3,616.10, gathering momentum as investors diverted focus from its main rival.

On the Bitstamp Exchange ether was last up about four per cent at $3,568.92. Bitcoin was down 0.3 per cent at $57,353.03 and about 11 per cent below its record intraday high at $64,895.22 set on April 14.

Ether, the token traded over the ethereum blockchain, topped $3,000 for the first time on Monday. It is up more than 385 per cent this year, compared with 96 per cent for bitcoin.

The rise is in part a spillover from flows into bitcoin, which has grown in stature as big-name investors from Elon Musk’s carmaker Tesla Inc to Wall Street investor Stanley Druckenmiller bought in.

“Ethereum has been able to maintain its positive momentum, a crushing series of all-time highs in the past week,” said Konstantin Anissimov, executive director at cryptocurrency exchange CEX.IO.

“The current all-time high has reignited the ambitious sentiment that ethereum may eventually flippen (supplant) bitcoin by market capitalization in the near future.”

Also, a technical adjustment called EIP (ethereum improvement proposal) 1559, expected to reduce the supply of ethereum and go live in July, has provided a lift for the digital currency.

Still, there is a speculative frenzy going on in the asset class. Joke cryptocurrency dogecoin is up by 24,000 per cent over the last 12 months and is now the fourth-largest cryptocurrency by market capitalisation.