BITCOIN prices have reached an all-time high, surpassing $64,000 for the first time since the currency was invented.
This is the second day in a row that the cryptocurrency has reached record heights.
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The Bitcoin price peaked at $64,863.10 (£47068.23) at 12:45pm today and is now hovering well above the $63,000 mark, according to Coinmarketcap.com.
Yesterday, Bitcoin prices soared above $62,000, meaning its value had doubled in just a year.
In part, rising prices are due to increasing levels of support from well-known, mainstream companies such as PayPal, Mastercard, Facebook and Tesla.
For instance, Paypal recently announced that its users will be able to buy and sell bitcoin – and even make purchases.
What is Bitcoin?
BITCOIN got you baffled? Here’s what you need to know:
- Bitcoin is a virtual currency
- It’s traded between people without the help of a bank
- Every transaction is recorded in a public ledger, or “blockchain”
- Bitcoin is created by mining
- Mining involves solving difficult maths problems using computer processors
- Bitcoin can be traded anonymously, which can make it a popular way of funding illegal activities
- The value of Bitcoin fluctuates wildly
- Bitcoin is one of many different cryptocurrencies, but by far the most popular
Meanwhile, in February, Tesla announced that customers could make purchases using the currency, leading to Bitcoin price highs at the time.
Tesla CEO Elon Musk also sent another cryptocurrency, called Dogecoin, on a price surge after he tweeted a gif of the dog featured in the meme.
Both Mastercard and BNY Mellon have also revealed plans to incorporate bitcoin into their businesses.
Mastercard said its platform would support bitcoin payments before the end of this this year.
BNY Mellon, which is America’s oldest bank, pledged to start transferring and issuing the cryptocurrency.
As well as big name companies getting on board with Bitcoin, cryptocurrencies are also getting a lot of attention due to the upcoming Coinbase stock market float.
The company, which lets you buy and sell other cryptocurrencies, is set to list its shares on the Nasdaq stock exchange this week.
As a result, digital currency Ethereum – the second largest cryptocurrency – also hit a highs on Tuesday.
5 risks of crypto investments
THE Financial Conduct Authority (FCA) has warned people about the risks of investing in cryptocurrencies.
- Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements.
- Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
- Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market.
- Charges and fees: Consumers should consider the impact of fees and charges on their investment which may be more than those for regulated investment products.
- Marketing materials: Firms may overstate the returns of products or understate the risks involved.
While the cryptocurrencies are currently doing very well, prices are extremely volatile and investors should be wary.
The volatility means that your cash can go down as well as up in the blink of an eye.
For instance, the price of Bitcoin plummeted when the coronavirus crisis first hit, falling to lows of £3,300 last March.
City watchdog, the FCA, has even issued a warning against investing in cryptocurrencies.
Despite this, investors have flocked to digital currencies – including Bitcoin – throughout the pandemic, sending the price skyrocketing.
Before even thinking about joining the trend, you need to make sure you know the risks and can afford to lose the money.
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Bitcoin broke through the $20,000 price mark for the first time in December.
An advert for a bitcoin exchange Coinfloor was banned last month by the advertising watchdog for suggesting buying the cryptocurrency is a secure way to invest.
People considering investing in Bitcoin or shares and stocks have been warned over “risky” tips being shared on TikTok.
Bitcoin shares surge to RECORD high as Mastercard and BNY Mellon announce cryptocurrency projects
