[ad_1]
The value of bitcoin, the world’s best-known cryptocurrency, has reached an all-time high of more than $ 20,000.
The cryptocurrency surged by more than 6% to hit $ 20,632 (£ 15,283) against the US dollar, extending a winning streak this year amid growing interest among large investment companies attracted by its quick profit potential.
The price of bitcoin has risen by more than 400% this year from a low of around $ 3,600 in March, when the coronavirus pandemic triggered a huge sell-off in financial markets around the world.
Analysts said that unlike previous surges, a major price driver appeared to be more institutional investors buying the cryptocurrency.
Nigel Green, CEO of deVere Group, a finance company that operates a bitcoin exchange, said: “They are being attracted by the good returns that the digital asset class currently offers but, more importantly, by the huge future potential. it offers. offers.
“As some of the world’s largest institutions, including multinational payments companies and Wall Street giants, increasingly pile on cryptocurrencies, bringing with them their enormous expertise and capital, this in turn increases the consumer interest “.
The bitcoin rally comes after a 2017 rally in the digital currency when it rose by more than 900% to approach $ 20,000 in mid-December, with global financial leaders and economists warning of a price bubble on par with the Dutch mania for tulips the 17th century. Bitcoin then plunged below $ 7,000 in early February 2018, but it never dropped to zero as some analysts predicted at the time.
Investor interest has risen in bitcoin as a potential way to hedge against rising inflation. Expectations among city investors for higher inflation rates have risen in recent weeks, fueled by the prospect of a stronger global economic recovery next year thanks to the Covid vaccine and stimulus measures from central banks and governments of advanced economies.
Ruffer Investment Management, a UK-based investment management firm with over £ 20bn in assets under management, last month made a bet in bitcoin now worth around £ 550m, on one of the largest signs of growing demand among traditional investment managers.
A company spokesperson said the move was to diversify Ruffer’s portfolios into gold and inflation-linked bonds. “[This] it acts as a hedge for some of the risks we see in a fragile monetary system and distorted financial markets. “
Ayush Ansal, CEO of Crimson Black Capital, a hedge fund, said that public interest in bitcoin would be renewed over Christmas. “After being in a wasteland since the infamous bull run in late 2017, cryptocurrencies and bitcoin in particular are back.
“Bitcoin has been threatening the symbolic $ 20,000 barrier for some time and has finally broken through.”
