Bitcoin passes US$60,000 for first time

Bitcoin passed the US$60,000 mark for the first time on Saturday, with analysts saying the giant US stimulus package helped boost the world’s most popular virtual currency on its record-breaking run.

The cryptocurrency hit US$60,197 at 1234 GMT and continued to hover around US$60,000, according to the website CoinMarketCap.

Bitcoin has tripled in value over the last three months – it was worth US$20,000 in December – bolstered by increasing backing from corporate heavyweights.

Markets.com analyst Neil Wilson said that in recent days “Bitcoin went up as investors looked to the imminent arrival of stimulus cheques”.

Individuals in the US earning up to US$75,000 will receive a cheque for US$1,400 from this weekend, after President Joe Biden signed his US$1.9 trillion Covid-19 rescue plan into law this week.

Bitcoin has been on a meteoric rise since March last year, when it stood at US$5,000, spurred by online payments giant PayPal saying it would allow account holders to use cryptocurrency.

Last month Elon Musk’s electric carmaker Tesla invested US$1.5 billion in the virtual unit, while Twitter chief Jack Dorsey and rap mogul Jay-Z said they are creating a fund aimed at making Bitcoin “the internet’s currency”.

Others jumping on the bandwagon include Wall Street player BNY Mellon, investment fund giant BlackRock and credit card titan Mastercard.

Bitcoin, which was launched back in 2009, hit the headlines in 2017 after soaring from less than US$1,000 in January to almost US$20,000 in December of the same year.

The virtual bubble then burst in subsequent days, with bitcoin’s value fluctuating wildly before sinking below US$5,000 by October 2018.

However the last year’s rise has been more steady, with investors and Wall Street finance giants wooed by dizzying growth, the opportunity for profit and asset diversification, and a safe store of value to guard against inflation.

Bitcoins are traded via a decentralised registry system known as a blockchain.

The system requires massive computer processing power in order to manage and implement transactions.

That power is provided by “miners”, who do so in the hope they will receive new bitcoins for validating transaction data.