Bitcoin (BTC-USD) reached a value of over $30,000 (£21,941) for the first time ever on Saturday, just two weeks after it crossed the $20,000 mark.
At the time of publish it was 10% higher at $32,504, meaning that the digital currency now has a market capitalisation of more than $600bn.
This places it among the largest global assets in the world behind the likes of Facebook (FB), Apple (AAPL), and Tesla (TSLA). Last week Bitcoin pushed ahead of Visa (V) making it the world’s largest financial service.
In 2020, cryptocurrencies had a stellar rally as lockdowns and fears of a global recession, due to the COVID-19 pandemic, sent investors flocking to alternative financial assets.
During the course of the year a number of financial institutions started backing cryptocurrencies and blockchain technologies which sent its price soaring.
In October, PayPal (PYPL) announced that it would allow the cryptocurrencies on its platform in what was a major move toward the mass adoption of digital currencies.
The California-based payments platform said the launch of its new service would allow customers to buy, hold and sell cryptocurrency directly from their PayPal account.
US account holders will be able to deal in digital coins, including Bitcoin, Ethereum, Bitcoin Cash and Litecoin in the coming weeks and plans to expand to Venmo and some countries in the first half of 2021.
Customers will be able to use their cryptocurrency holdings to pay for goods and services at PayPal’s 26 million merchants worldwide from early next year. However, merchants will not receive virtual coin payments, with cryptocurrency payments being settled using fiat currencies, such as the US dollar, the company said.
PayPal has partnered with Paxos, a New York chartered trust company, to provide cryptocurrency trading and custodial services.
Bitcoin’s historic rise in December was accelerated in particular by British fund manager Ruffer Investment Management (RICA.L), which revealed it had bought $745m worth of Bitcoin, pushing the digital currency above the $20,000 price level for the first time.
Ruffer has allocated 2.7% of the fund to the digital currency, using its profits from gold to buy Bitcoin.
Despite its rise this year, the cryptocurrency remains extremely volatile and experts often remain sceptical about using it as an investment.
However, Matt Hougan, chief investment officer of Bitwise Asset Management said: “What’s happening now - and it’s happening faster than anyone could ever imagine - is that Bitcoin is moving from a fringe esoteric asset to the mainstream.”
“If it’s going mainstream, there is just so much money on the sidelines that is going to have to come in and establish a position that it leaves me very bullish for 2021.”
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