Bitcoin reached an all-time high on Wednesday after breaking the $10,000 price barrier for the first time, seeing a more than tenfold increase in its value over the course of 2017. On Wednesday, the value of the cryptocurrency surged to $10,059, pushing its market capitalization to $171bn. The skyrocketing of its value price, however, has raised fears of a possible bubble.
Bitcoin was initially launched in 2009 as a bit of encrypted software. Since its launch, Bitcoin has had a roller coaster ride, with its valuation rising and dropping through time. Although the cryptocurrency previously had a cycle of highs and lows, this year has seen its valuation skyrocket from just under $1,000 at the start of the year to more than $10,000 this week.
According to reports, what helped drive up the price of Bitcoin were the strides made to bring it into the mainstream financial system. Analysts say that the popularity of the cryptocurrency has driven the growing interest of major investors and has prompted exchange giant CME Group to introduce a futures marketplace for Bitcoin.
The US Exchange operator said last month that this futures marketplace would allow Wall Street to speculate on Bitcoin as it does on other commodities such as gold. Currently, Wall Street is unable to dabble with the Bitcoin due to its lack of infrastructure and financial products.
Due to the unusually fast rate of growth of Bitcoin, many are now fearing the possibility of a bubble. A report from Bloomberg reads, "This is a bubble and there is a lot of froth. This is going to be the biggest bubble of our lifetimes." Although Bitcoin is usable when serving as an alternative bet in times of global economic uncertainty, critics say that its volatility makes it an apparent subject to theft and other illegal online purchases.