Bitcoin value tops $1,000 US for first time since 2013
Value of digital currency doubled in 2016 and is showing no signs of slowing down in 2017
The value of bitcoin is above $1,000 US on Monday, the first time that has been the case since December 2013.
The world's leading digital cryptocurrency was trading at $1,027 US per bitcoin on Monday, according to Coindesk, an increase of more than three per cent within a day.
Created in 2009, bitcoin was invented as an alternative to the world's paper currencies because it isn't tied to any physical assets or controlled by any country's central bank. It's pitched as an alternative to the fiat money system and is admired for its ability to easily transfer money without detection or interference from governments or multinational corporations.
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The currency's value soared to more than $1,200 US in late 2013, as numerous debt crises in Europe called into the question the value of the continent's many fiat currencies. But bitcoin's value came crashing down a few months later when the bitcoin exchange Mt. Gox, which was then the largest processor in the world of bitcoins, admitted that it had lost $450 million US worth of the supposedly secure currency due to theft.
The sell-off was so swift that as recently as two years ago, bitcoins were worth less than $250. Today, however, they are near their all time highs again.
Bitcoins have quietly doubled in value through 2016, and the surge picked up especially after the election of Donald Trump.
But the catalyst for the recent run-up appears to be moves by two governments in Asia. In November, the government of India moved to eliminate high-denomination bills to combat money laundering and counterfeiting. That has prompted a flood of capital to alternative forms of money, and bitcoin is benefiting from that sudden demand.
China has repeatedly moved recently to implement more capital controls on its currency, the yuan, to limit the amount that people can withdraw out of the country. That's made it harder for wealthy Chinese to get their money out of the country, so many have turned to bitcoin to move that cash. That's also contributing to the surge in bitcoin's value.
"The growing war on cash, and capital controls, is making bitcoin look like a viable, if high risk, alternative," Paul Gordon of digital currency firm Quantave told Reuters.