Bitcoin more than doubled for the year, Ethereum jumped more than 20 times

Bitcoin has more than doubled in price this year alone, but it has been outperformed by its closest rival Ether, which is up over 2,300 percent.

On January 1, bitcoin was trading at the day's high of $1,003.25. On Wednesday, it broke through the $2,300 barrier for the first time to hit a fresh record high of $2,377.32, according to CoinDesk, marking a year-to-date rise of 137 percent.

Meanwhile, bullishness around bitcoin has stoked appetite for other cryptocurrencies. One in particular known as ether is getting traction. Ether has risen from $8.24 on January 1, to a high of $203.30, according to data from Coinmarketcap.com. This represents a 2,367 percent rise year-to-date.

What is the difference between the two cryptocurrencies?

Firstly, Ethereum is a lot younger having only been started in 2014, whereas bitcoin began in 2009. Ether's market cap is at $18.6 billion versus bitcoin's $39.2 billion, according to Coinmarketcap.com.

Ethereum is also focused on smart contracts, while bitcoin is very much about payment technology.

Why has ether rallied so much?

While bitcoin has been getting support from certain governments and investors, the Ethereum blockchain has been backed by corporates wishing to use the technology for smart contract applications..

A group called the Enterprise Ethereum Alliance (EEA) was recently founded to connect large companies to technology vendors in order to work on projects using the blockchain. Companies involved in the launch include JPMorgan, Microsoft and Intel.

Will the rally last?

Not all in the market are convinced that the ether rally will last. Bitcoin trader Jason Hamilton is worried that products like Ethereum could be cloned.

"People are buying a specific blockchain, but the big interests are in the technology. They'll probably make their own clones and the ether tokens everyone is buying won't be used for much except trading. Who knows, though," Hamilton told CNBC via a direct message on Twitter.

"I don't usually trade ether. I'm afraid of that bubble bursting, but it could go on bubbling up for a long time still."

Source: CNBC

Jr Trader Ivan Ivanov