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24 Feb, 2017 15:06

Bitcoin price hits 3-year record, striving to beat 2013 high

Bitcoin price hits 3-year record, striving to beat 2013 high

The digital currency has reached its three-year high amid mounting expectations that the US Securities and Exchange Commission could soon approve the establishment of first Bitcoin exchange-traded fund.

As of Friday, Bitcoin was trading at a record high of 1,219.24, according to Xe.com, which tracks Bitcoin and other currency rates. 

The all-time high was $1,230.68, reached on December 4, 2013, according to Xe.com.

The digital currency’s rate came amid speculation that the US Securities and Exchange Commission (SEC) could approve the establishment of the first Bitcoin exchange-traded fund, Reuters reported.

The SEC is set to decide by March 11 on approval of an exchange-traded fund (ETF) request filed almost four years ago by Cameron and Tyler Winklevoss. An ETF is normally an investment fund traded on stock exchanges, and includes assets such as stocks or bonds. Since 2008, establishment of actively managed ETFs is being authorized by the SEC.

If approved in mid-March, it would be the first Bitcoin ETF issued and regulated in the US. Three separate ETFs tracking the value of bitcoin have been filed with the SEC for approval.

"If approved this would certainly give a dramatic condoning of Bitcoin by the authorities and powers that be," Charles Hayter, CEO of digital currency analytics firm Cryptocompare, told Reuters.

The three-year record also comes after a volatile start of the year, when Bitcoin surged more than 20 percent on the back of large buying interest from China. The currency’s price then nosedived 35 percent amid concerns that Beijing was going to crack down on domestic Bitcoin exchanges trading.

Earlier in February, the People’s Bank of China (PBOC) said it has directed the exchanges not to take part in financial activities such as margin lending or allow money laundering. If such a violation is detected “the circumstance will be serious,” and an inspection team will close down the offending exchange, PBOC said on their website

Bitcoin cryptocurrency has no issuing or regulating authority, in contrast to conventional currencies.

The legal status of Bitcoin remains knotty and varies substantially from country to country. While some countries have explicitly welcomed its use and trade, others have banned or restricted it. Critics of Bitcoin warn it becomes increasingly attractive for organized crime.

READ MORE: Beijing threatens to shut down bitcoin exchanges

Various media reports claim that child pornography, murder-for-hire services, and weapons are allegedly available on Darknet market sites that sell in Bitcoin.

In other cases, Bitcoin is being offered to average customers exactly as any other currency. For instance, the first bitcoin ATM was set up in Austria three years ago and was successful enough to inspire the launch of further ones. Vienna now has more than 20 bitcoin-friendly vendors ranging from restaurants, bistros, and bars.

Bitcoin was the best-performing currency in 2016, whose value more than doubled during the year. Its 126 percent rally came on the back of strong demand in China.