The price of Bitcoin has hit a new high, despite a month of turmoil that has seen a split in how the cryptocurrency works.
Bitcoin’s new valuation, which spiked at $3,448.72 (£2647.93) before dropping to $3,417.20 (£2623.73) at time of writing, marks the first time that the cryptocurrency had passed the $3,000 mark, and gives the market value of all Bitcoins an estimated value of $56bn (£43bn).
There had been concerns that the value of Bitcoins could plummet in the wake of the the ‘hard fork’, which led to the creation of Bitcoin Cash. Although some predicted that those that had invested in Bitcoin already could be heading for an unexpected windfall.
Bitcoin Cash is currently trading at $266.57, well below its peak price of $727.54, although the cryptocurrency has been prone to price fluctuations in the past and Coinbase’s decision to support it, made last week, will help to appease investors.
“While the breakaway plan is argued to be more aligned to the vision of Bitcoin’s original creator and potentially more safe as it doesn’t include a controversial feature to move the digital signatures of transactions off the ledger, it arguably risks the blockchain – the ledger containing every transactions – growing too big,” said Mustafa Al-Bassam, security expert at Secure Trading.
“This will mean that fewer people have the storage space required to run a full Bitcoin client, which may cause Bitcoin to become more centralised, as only organisations with a large amount of resources will be able to store the entire ledger.”
The reason for such interest in Bitcoin, which is based on the distributed ledger technology of blockchain, is the expected boost it could provide to various industries, financial services being the most obvious.
Earlier this month it was reported that over 90% of financial services executives have said that blockchain technology will be critical or important to the future of their firms, with 75% expecting more than a 5% revenue growth from its use, or equivalent to $20bn in savings, according to research from Cognizant.
Whilst blockchain technology and Bitcoins are separate, there is certainly overlap as to how their usefulness is being viewed by some of the largest organisations in the world.