The virtual currency has continued its breathtaking rise surging past $1,000, after already winning the crown of the best-performing currency in 2016 by more than doubling its value in the course of the year.
Bitcoin was trading at a value of $1,024 in afternoon European trading on Monday, after breaking the $1,000 mark for the second time in its eight-year history on Sunday. It is now within reach of its historic high of more than $1,200 reached in 2013.
In 2016, the virtual currency more than doubled in value making it the number one gainer in global currency trading.
Bitcoin was launched in 2009 as a bit of encrypted software written by someone using the Japanese-sounding name Satoshi Nakamoto. Earlier this year secretive Australian entrepreneur Craig Wrightsaid that he was the creator, but some have raised doubts over his claim.
The supply of Bitcoin is limited and it trades in cyberspace. Unlike traditional currencies such as the dollar or the euro, which are issued and controlled by a central bank, Bitcoin creation is decentralized. Encrypted digital coins are created by supercomputers and then traded online or exchanged for goods and services by a network of users.
Some people use Bitcoin as an investment, while there are also claims that criminals use it as a currency for illicit transactions beyond the reach of law enforcement in secretive Internet-based drugs and arms deals.
Analysts said the rise in Bitcoin was due to the currency’s safe-haven status, like gold, at a time of global uncertainty. Others believe buying is being driven by speculative demand, with investors anticipating future rises and creating an unsustainable bubble.
Bitcoin’s value has fluctuated wildly since its creation. News of a major Bitcoin theft by hackers in August, for example, sent its price plummeting by more than 20 percent in the aftermath.