The world’s most valued digital coin Bitcoin has touched $29,000 for the first time, marking a perfect end to a groundbreaking year for the cryptocurrency.
In 2020, Bitcoin had almost quadrupled its value amid increased interest from big and small investors alike, positioning it into the world’s largest digital coin.
Last day, Bitcoin touched $29,300 before falling down 0.67 percent to trade at $28,774.36. It has advanced almost 50 percent in December, on track for its biggest monthly gain since May 2019.
Bitcoin has now quadrupled its value in 2020 amid the global coronavirus pandemic, while the wider Bloomberg Galaxy Crypto Index tracking the digital coin has jumped up about 280 percent as rival coins such as Ether have also rallied. As per industry website CoinMarketCap, the recent gains have taken bitcoin’s market capitalization to over $536 billion.
The digital coin’s potential for making quick gains, as well as the hope that it could become a mainstream payment method, has attracted demand from larger US investors and from traders who relied on equities.
“You can buy a stock like Amazon, you can buy a stock like Apple, and you know what you got. Bitcoin you really just have digits on a screen and you’re really hoping that the guy behind you sees it as being worth more than what you just paid for it, so it’s a purely speculative view,” said Dennis Dick, a proprietary trader at Bright Trading LLC.
The latest price surge continues to create different opinions between those who consider cryptocurrencies as a hedge against dollar weakness and inflation risk and others who are skeptical about Bitcoin’s validity as an asset class given its speculative nature.
Regulatory concerns also remain a huge factor for crypto investors. The Securities and Exchange Commission had earlier accused Ripple Labs Inc and its executives of misleading investors in affiliated token XRP and this highlights the need for stricter rules to handle digital assets.