Bitcoin races to record high of $18,700

SYDNEY: The craze for cryptocurrencies entered a new chapter on Monday as bitcoin futures rocketed by one-fifth of their value at a closely-watched launch, while Asian shares climbed amid optimism about global growth.

The most-traded contract on the Chicago-based CBOE Global Markets exchange opened at $15,460 in New York on Sunday evening, before leaping to a high of $18,700 – a gain of 21 percent. They were last quoted at $17,550 a premium of more than $1,600 to the price on Gemini Exchange.

The futures are cash-settled contracts based on the auction price of bitcoin in U.S. dollars on the Gemini Exchange, which is owned and operated by virtual currency entrepreneurs Cameron and Tyler Winklevoss.

The cryptocurrency has boasted a gravity-defying 15-fold gain since the start of the year, attracting institutional interest and no small amount of question marks.

The acting governor of the Reserve Bank of New Zealand on Sunday said bitcoin appeared to be a “classic case” of a bubble.

“With a bubble you never know how far it is going to go before it comes around,” Grant Spencer told TVNZ.

Some market participants believe the fallout across other financial assets from a potential bursting of the bubble will be limited.

Asian shares were buoyant following strong U.S payrolls data and better-than-expected Chinese trade data on Friday.

The MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.4 percent, staying well above a recent two-month trough of 542.27 points.

Japan’s Nikkei added 0.4 percent while Chinese shares rallied, with the blue-chip CSI 300 index up 0.9 percent. Hong Kong’s Hang Seng index gained 0.5 percent.

 

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