Bitcoin rallies past $11,000 barrier

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LONDON/NEW YORK: Bitcoin zoomed past $11,000 (£8,185.5) to hit a record high for the sixth day in a row on Wednesday after gaining more than $1,000 in just 12 hours, stoking concerns that a rapidly swelling bubble could be set to burst in spectacular fashion.

After soaring more than 1,000 percent since the start of the year, bitcoin rose as much as 15 percent on Wednesday, but by mid-afternoon in New York, the virtual currency was trading at $9,500, down 3.7 percent on the day on Luxembourg-based Bitstamp, one of the largest and most liquid cryptocurrency exchanges.

Bitcoin topped $10,000 for the first time in early Asia trading, before surging above $11,000 less than 12 hours later to reach $11,395.

Bitcoin’s rapid ascent has led to countless warnings that it has reached bubble territory. But the warnings have had little effect, with dozens of new crypto-hedge funds entering the market and retail investors piling in.

London-based Blockchain.info, one of the biggest global bitcoin wallet-providers, said on Wednesday that it had added a record number of new users on Tuesday, with more than 100,000 customers signing up, taking the total number to more than 19 million.

The evidence suggests that few of the users are buying bitcoin to use it as a means of exchange, but are speculating to increase their capital.

 

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