Bitcoin Surges Past $40,000, Doubling Value in Less Than One Month
Bitcoin just jumped above the $40,000 mark for the first time in a rapid doubling of its record-breaking $20,000 value achieved in December, according to CoinDesk ratings.
The high-water mark was $40,324.01 around 1:14 PM EST, before the cryptocurrency made a sharp drop back down to roughly $38,000 within the hour.
RELATED: BITCOIN HAS BROKEN THROUGH $20,000 LEVEL FOR THE FIRST TIME EVER
Bitcoin surges past $40,000, doubles value in less than one month
This record-breaking development came days after the cryptocurrency broke an all-time high of more than $34,800 on Sunday — which was also the bitcoin network's 12th anniversary of creation.
In mid-December 2020, Bitcoin broke its earlier record of $20,000 — a meteoric rise attesting to the increasingly popular status of the cryptocurrency among institutional investors and supporters, who believe it will soon supplant gold as a standard of value.
UPDATE Jan. 7, 3:26 PM EST: Bitcoin becoming means to hedge against inflation, depreciating US dollar
JP Morgan investment bank analysts said the cryptocurrency might rise as high as $146,000 if it solidifies its nascent reputation as a viable alternative to gold, The Guardian reports.
The analysts also said bitcoin was becoming an option for investors interested in hedging against inflation — but were unhappy about the depreciating value of the U.S. dollar.
UPDATE Jan. 7, 3:35 PM EST: Skeptics argue bitcoin lacks inherent value, but continued rise speaks for itself
As of writing, there are more than 18 million bitcoins in existence — created by miners who offer computational power, which generates the blockchain. The blockchain is a decentralized record of all transactions completed with bitcoin, which is maintained via a network of thousands of computers globally.
The blockchain system is hardwired for a maximum of 21 million coins.
Skeptics of the cryptocurrency have warned against the crypto boom, arguing the coin has no inherent value. But Chief Marketing Analyst at AvaTrade Naeem Aslam — who is also an online broker — said bitcoin's rise stands as a case-in-point against the critics.
UPDATE Jan. 7, 3:40 PM EST: Next Bitcoin milestone is breaching $50,000 mark
"A major price level has been hit and bitcoin has proved that this is not the asset class you want to mess around with," said Aslam, The Guardian reports. "It has proved itself to all disbelievers today."
"Institutional traders are the ones who have really got the rally going," said Aslam, who suggested the next significant milestone for the cryptocurrency would happen once it breaches a value of $50,000.
Even processing the seemingly-unstoppable rise of bitcoin — and cryptocurrency broadly — can feel like setting one's hair on fire. But with the digitization of nearly every form of human interaction, where we get our politics in the shared realities of social media, it's hard to find a good reason why the fundamental shared reality of currency and economics shouldn't also shift to all-digital.