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The best bitcoin virtual currency briefly climbed to a new high on Monday, heading towards $ 20,000 per unit.
The currency jumped above its previous high of $ 19,783 to hit 19,800 with some industry analysts predicting it will soon breach the 20,000 resistance point.
The debate on the state of the digital asset, launched at the end of 2008, on whether it should be seen as a form of money, a good or a commodity, has ignited.
Monday saw it rise by about 8%, taking its annual increase over 150%, according to data compiled by Bloomberg, a far cry from the few cents it traded in its early days following the global financial crash.
In March it was only $ 5,000.
The unit, which regularly sees its value undergo wild swings, was back at & 19,380 by mid-afternoon, up 6.5% daily, leaving its total market capitalization at around $ 360 billion.
Since October, “digital gold” has risen by about 40%, spurred in particular by online payment giant PayPal which says it would allow account holders to use cryptocurrency.
The California-based firm also said the new service will allow customers to buy, hold and sell units of cryptocurrency and use them for payments at retailers.
After its first tear in December 2017, bitcoin saw its market value plummet about three quarters in the following months.
Craig Erlam, senior market analyst at OANDA, said on Monday that bitcoin price levels are now “entering uncharted territory” and could rise further as financial institutions show an ever-growing interest in digital currencies.
Several central banks have responded to the rise of cryptocurrencies and the decline in global cash use by announcing plans for bank-backed digital units that would be ‘risk-free’ such as fiat bills and coins.
Several central banks, including those of China and Sweden, but also the US Federal Reserve, are also testing digital applications in response to Facebook’s recent moves to produce its own digital unit, Libra.
Unregulated by any central bank, bitcoin has emerged as an attractive option for investors with an appetite for the exotic, although criminals have also seen its hidden appeal.
After the unit first crossed $ 1,000 in 2013, it began to attract more and more attention from financial institutions.
By the end of the week, it emerged that hedge fund Guggenheim Partners revealed in a regulatory document that it is considering allocating around $ 530 million for a bitcoin investment via a private investment vehicle.
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