Bitcoin has hit an all-time peak of $AUD28,905.53 ($US21,9291.79) today to well and truly smash through the psychological price barrier of $US20,000.
The cryptocurrency is up more than 170% over the last 12 months. It has been boosted by recent endorsements from major institutional players and has attracted demand from larger investors.
After dipping to $AUD6,517.59 in mid-March 2020 as uncertainly around COVID-19 saw global markets crumble, the price of Bitcoin has since shot up over 440% in the ensuing nine months.
“Many of our clients have been expecting Bitcoin to surpass its all-time high of $20,000 given the recent news from major institutional players like SGX and MassMutual openly endorsing Bitcoin,” said Scott Freeman, co-founder and partner at trading firm JST Capital told Reuters.
A recent Reuters report claimed that fund manager Ruffer Investment Management moved $US675 million of its clients’ money into Bitcoin, which was seen as a move towards rising institutional interest in the digital currency.
Another vote of confidence towards the cryptocurrency was back on 21 October when major online payment provider PayPal announced it would allow account holders to use Bitcoin.
The last Bitcoin boom was back in 2017 when it rose by more than 900% to peak at $US19,783 in December 2017 before crashing below $7,000 by February 2018.
However, the chief executive of Isle of Man-based Bitcoin and cryptocurrency exchange CoinCorner, Danny Scott, said that the recent surge is different to the one experienced back in 2017.
“Compared to 2017 when demand came from the retail market, this will eventually happen again, of course, the current demand is coming from an institutional level completely flying under the radar for many people and it looks set to continue through 2021,” Mr Scott said.
Bitcoin was invented by Satoshi Nakamoto in 2008 and first started trading in July 2010 at $US0.08 per coin. Early investors have since made a lot of coin.