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On Monday, Bitcoin price hit a record high price, continuing a gradual increase in the pandemic’s early stages. According to bitcoin index platform CoinDesk, the cryptocurrency climbed to $19,850 on Monday, beating its previous high mark set in 2017.
It was a long path back to the peak. It witnessed a crash after reaching $20,000 in December 2017 that saw one bitcoin’s value plunged to just over $3,000 a year later.
Built by an individual developer (or group of developers) in 2008, the former spike in the decentralized currency was powered by Asian investors. Still, CoinDesk suggests the latest run is built on North American institutional investors.
Square, the transactions provider, founded by Jack Dorsey of Twitter, revealed that it had invested $50 million in Bitcoin in October. Square Chief Financial Officer Amrita Ahuja said, “We believe that bitcoin has the potential to be a more ubiquitous currency in the future,”
Companies such as PayPal are on board as well. The online payments giant said a few weeks after Square’s announcement that it would start enabling cryptocurrencies, like Bitcoin and Ethereum, to be purchased, sold, and stored on its platform in early 2021. Some analysts see it as an alternative to gold, a value store that can defend against inflation.
Bitcoin price is extremely volatile, mainly influenced by buying and selling, speculation, the news cycle, and questions about its use. The value dipped slightly after hitting its high record on Monday, and as of writing, one Bitcoin price is worth about $19,600. Still, some analysts believe it to climb over the $20,000 mark during this rally and be more sustainable in the long term.
For Bitcoin, however, these are not all rosy highs. Climate scientists have doubts about the use of energy required for Bitcoin to be mined. Mining the currency requires high computational power levels that solve mathematical puzzles to earn new coins. Researchers proposed in 2018 that a rise in the popularity of the cryptocurrency could create a demand for electricity that would produce excessive carbon emissions.
Check out: What You Must Know About the Bitcoin Wallet: Eric Dalius