ITCOIN was charging towards a record high today fueled by mounting mainstream acceptance, its perceived immunity to inflation and apparent endorsements from both one of the world’s most influential investors and a Game of Thrones star.
The cryptocurrency surged 3.5% in 24 hours to hit $18,650 (£14,059) at 3pm GMT, and was on course to hit the highest level since December 2017, when it peaked at $19,783.
The digital token – which has a history of steep ascents and steeper drops – has exploded from $11,901 since October 21 when PayPal announced it would allow users it to trade on its network.
The rush went mainstream when Game of Thrones star Maisie Williams took a poll on Twitter on whether she should “go long” (although only 46.6% said ‘yes’).
Bitcoin is now up more than 160% this year have risen steadily since March, when it was brought low by the pandemic, ending its gradual recovery from the crash that followed 2017’s retail investor-fuelled high.
Analysts say it is now being sought out by investors as a hedge against inflation rises that could follow massive government spending in the US and around the world to prop up economies devastated by Covid-19.
Bitcoin’s supply is capped at 21 million, and according to reports this week, there are only around 3.4million still available to be traded: the rest locked in dormant ‘wallets’. Crucially, given its existence in a global’ blockchain’ of peer-to-peer linked computers, no central bank or government can print more.
An extra bump came today when Rick Rieder, chief investment officer of global fixed income at asset manager BlackRock, told CNBC: “Do I think it’s a durable mechanism that could take the place of gold to a large extent? Yeah, I do, because it’s so much more functional than passing a bar of gold around.”
Nikolaos Panigirtzoglou, an analyst at JPMorgan. “There is a reassessment about its value here as an alternative currency, as an alternative to gold.”
“The ultimate endorsement of crypto is whether you can buy your groceries with it and pay taxes with it,” said Russ Mould, investment director at AJ Bell. “That would be the ultimate acceptance.”
Craig Erlam, Senior Market Analyst at OANDA Europe , said: “Given how the last month has gone and the hype that’s back with a bang, you can only imagine where it will go next if new highs are made. $25,000? Maybe $30,000 by year-end?
“The euphoria is back and while the ride to the top may be fun, the bit that follows has historically shown to be quite the opposite.”