Bitcoin reached a record high of more than $6,000 on Friday the 20th Oct ’17, enabling the market capitalization rise to $100 billion at one point, since the investors were betting on an asset that has a limited supply and has paved the way for a upsetting of crypto-currencies.
The original virtual currency has gained over 500% this year, which is more than any other tradable asset class. Bitcoin though is very volatile has resulted in gains and losses ranging between 26% and 16% respectively on any given day.
Friday saw a record peak $6,000.10 on the BitStamp platform, and lastly stood at $5,964.24, up 4.7% on the day. Bitcoin is a digital currency that can either be held as an investment, or used as a foundation for future applications through the blockchain, its underlying technology. The blockchain is a digital ledger of transactions.
More than that envisaged the level of scarcity, the number of bitcoins in existence is not expected to exceed 21 million. Analysts said it was a combination of factors that drove Friday’s increase in price. Over the summer, China has banned the practice of raising capital through the sale of tokens to the public in what is known as initial coin offerings. It has also ordered the shutdown of digital currency exchanges. But it is felt that the Chinese ban is temporary.
Further, it may be noted that as much as 60% of the world’s bitcoin mining is happening in China, and hence, many of the high investments in ICO projects also come from crypto-currency holders in China, either directly or indirectly. Also it is believed, that investors have been going back into bitcoin due to uncertain global regulatory environment on crypto-currencies. A big part of bitcoin’s recent high swell was the ICO craze, which blasted this year. Bitcoins and ether, another digital currency, are used to purchase tokens for ICOs.