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Bitcoin celebrates new year with surge in value

Having risen in value in 2016 by 125 percent, the digital currency started 2017 by jumping above $1,000 for the first time in three years.

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Bitcoin celebrates new year with surge in value

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It has been a bumper year for bitcoin.

Point of view

The growing war on cash, and capital controls, is making bitcoin look like a viable, if high risk, alternative

Paul Gordon UK Digital Currency Association

Having risen in value in 2016 by 125 percent the digital currency started the new year by jumping above $1,000 for the first time in three years.

As most bitcoin trading is done in China, analysts linked that to the fall in the value that country’s currency – the yuan. Last year the yuan slipped seven percent, its weakest showing in over 20 years.

Bitcoin is used to move money across borders quickly and anonymously and is not controlled by any central bank or financial authority. That makes it attractive to those wanting to get around capital controls, such as China’s.

The bitcoin “cryptocurrency” is also getting more stable, though that is a relative term: last year its biggest daily moves were around 10 percent compared with daily price swings of as much as 40 percent in the past.

“The growing war on cash, and capital controls, is making bitcoin look like a viable, if high risk, alternative,” said Paul Gordon, a board member of the UK Digital Currency Association and co-founder of Quantave, a firm seeking to make it easier for institutional investors to access digital currency exchanges.

The numbers

  • Bitcoin’s all-time high: $1,163 in late 2013 (Bitstamp exchange)
  • Bitcoins in circulation: 12.5 are added to the system every 10 minutes
  • Total worth: a record-high above $16 billion (15.28 billion euros)