Bitcoin races past $5000 to a new all-time high

12 October, 2017, 20:38 | Author: Leticia Walters
  • Source Shutterstock

Typically for bitcoin, which at less than nine years old is still highly volatile and illiquid compared with traditional currencies and assets, the precise reason for its recent tear was unclear. High Bitcoin transactions show the high levels of interests the public has on Bitcoin. Majority of cryptocurrency transactions occur in the Bitcoin network.

This morning Bitcoin shot past $5,000, and is now hovering around $5,300 - up almost 10% from yesterday. As recently as December, bitcoin was trading at less than $1 000 dollars.

On Wednesday (Thursday NZ Time), Russian President Vladimir Putin warned of the "serious risks" surrounding the nascent market, while Russia's central bank said it would ban cryptocurrency trading websites. Speaking last month, he said there was a limited market for the digital currency, arguing that it was only fit for use by drug dealers, murderers and people living in countries such as North Korea.

Bitcoin mania just crossed the $5,000 mark.

But after dipping below US$3000 in mid-September, bitcoin has leapt in value by more than 75 per cent in four weeks.

Interestingly, not all cryptocurrencies are following bitcoin's lead today, which usually happens when the incumbent cryptocurrency experiences price fluctuations.

"Investors buy [an] asset because they are seduced by the prospect of further rapid gains without necessarily thinking about intrinsic value", he said.

"It is hard to argue that bitcoin does anything better than existing currency arrangements whilst it does some things to a lower standard", Murray added.

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