ETHEREUM CHALLENGES BITCOIN | A new virtual gold rush is under way. Ethereum, a rival to Bitcoin, has soared in value and climbed 1,000 percent over the last three months,

Nathaniel Popper reports in DealBook. Ethereum’s rise has attracted attention from giants like JPMorgan Chase, Microsoft and IBM. At the same time, Bitcoin has struggled as its community has been riven with divisions, which has slowed down transactions and driven businesses toward alternative currencies. Ethereum, like Bitcoin, is built on a blockchain in which every transaction is recorded publicly, offering the possibility of money and assets being exchanged more quickly and cheaply. Ethereum has also won fans with additional promises to provide a way to create online markets and programmable transactions known as smart contracts. The capabilities of the system have made it fascinating to executives — many corporations have created their own Ethereum networks with private blockchains, independent of the public system, which could detract from the value of the individual unit in the Ethereum system, known as an Ether. The value of an Ether has soared as high as $12 from about $1 since the beginning of the year, bringing the value of all existing Ether to over $1 billion at times. The first full public version of the Ethereum software was recently released, but it could yet face the same technical and legal problems that have affected Bitcoin. Advocates for Bitcoin have argued that Ethereum will face more security problems because its software is more complex. It is also less tested and has faced fewer attacks than Bitcoin.

YAHOO AND THE BUYBACK MIRAGE | Why do so many stockholders cheer when a company announces that it is buying back shares when it can be hazardous to its long-term financial health?

Gretchen Morgenson asks in Fair Game. Not all repurchase programs are bad, but the harmful probably outnumber the beneficial. And buybacks make earnings look better on a per-share basis, but have no effect on overall profit growth. The crucial flaw in buybacks is that they reward sellers of a company’s stock over its long-term holders, Ms. Morgenson writes. Yahoo bought back $6.6 billion of shares from 2008 to 2014, according to Robert L. Colby, a retired investment professional and developer of an equity valuation service. These purchases increased Yahoo’s earnings per share about 16 percent annually, on average, but growth in overall net profits came in at about 11 percent annually. Mr. Colby estimates that if Yahoo had invested the same amount of money in its operations, it would have had to generate only a 3.2 percent after-tax return to produce overall net profit growth of 16 percent annually over those years.

And the buybacks provided only a one-time benefit. This analysis may be of interest to Starboard Value, which nominated directors to replace Yahoo’s entire board on Thursday. Starboard’s move means only one thing, Steven Davidoff Solomon writes in Deal Professor. The race is on to sell Yahoo. But it is a silly situation. Yahoo’s directors are now trying to run an auction and reach a deal before they are thrown out. At the same time, Starboard is trying to unseat the board so it can cut the same deal. The groups are separated only by the fact that the hedge fund investors don’t trust the directors to cut a good deal.

Yahoo has had a trust issue for years, Mr. Davidoff Solomon writes. As a result, some are even gossiping about whether Yahoo is taking the sale process seriously. Yahoo may be in a tricky situation with this hedge fund, but it is hardly alone in buying back stock. A group of institutional investors, the Shareholder Forum, will convene soon to examine the benefits of buybacks. “You really have to ask why a company’s board decides to return a big chunk of capital instead of replacing managers with ones who can figure out how to develop the operations,” said Gary Lutin, who oversees the forum. “If the board doesn’t think it’s worth investing in the company’s future, how can a shareholder justify continuing to hold the stock, or voting for directors who’ve given up?”

ON THE AGENDA | The Commerce Department will publish data on personal consumption and income for February at 8:30 a.m.