Bitcoin surpasses $20,000 to hit new high

Bitcoin has hit a new all-time high of above $20,000 as the volatile cryptocurrency saw its latest surge in value.

It jumped 4.5% to as much as $20,440 (£15,140), according to Reuters.

Bitcoin has gained more than 170% this year against a backdrop of wider market turmoil caused by the coronavirus crisis.

It has been buoyed by demand from large investors keen on its potential for quick gains, as well as expectations about it gaining more widespread traction as a payment method.

The rise of Bitcoin has coincided with a recent drop in gold – a traditional safe haven in times of volatility.

But it has been a bumpy ride for investors, with the cryptocurrency passing $19,000 in November before dropping sharply.

A previously rally in 2017 saw it surpass $20,000, according to one valuation, before dropping 80%.

Bitcoin is the most valuable and popular of a range of digital currencies, and some have suggested it could pass $100,000 next year.

Others dismiss such predictions as outlandish.

Different figures are given for its all-time high depending on the exchanges that value it in dollar terms.

A $20,089 valuation reached in December 2017 is among those cited, while others say today’s rise was the first time it has breached the $20,000 mark.

Bank of England governor Andrew Bailey recently said he was “very nervous” about people using Bitcoin to make payments.

He has also warned that people who invest in the cryptocurrency should be prepared to “lose all their money”.

In October, the Financial Conduct Authority (FCA) said crypto derivatives – financial products based on the price of Bitcoin and other cryptocurrencies – would be banned from sale to retail consumers from next January.

It said consumers were at risk of “sudden and unexpected losses” from the investments – effectively bets on cryptocurrency prices – and that the ban would save them about £53m a year.

The FCA says cryptocurrencies have no intrinsic value.

But its supporters point out that Bitcoin is accepted by companies including Starbucks and Microsoft as a form of payment.

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