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Bitcoin rises to $34,000 as record rally continues soar.

REUTERS

Bitcoin’s value surged above $34,000 (£24,850) for the first time on Sunday as the leading cryptocurrency continued to soar.

It put the gain this year at almost $5,000, although by 17:00 GMT the price had drifted lower to about $33,000, according to the Coindesk website.

The rise was put down to interest from big investors seeking quick profits. It comes after Bitcoin soared 300% last year, with the price of many other digital currencies also rising sharply.

Ethereum, the second biggest cryptocurrency, gained 465% in 2020 Some analysts think Bitcoin’s value could rise even further as the US dollar drops further.

While the value of the US currency rose in March at the start of the coronavirus pandemic as investors sought safety amid the uncertainty, it has since dropped due to major stimulus from the US Federal Reserve. The currency ended last year with its biggest annual loss since 2017.

Bitcoin is traded in much the same way as real currencies like the US dollar and pound sterling.

But the cryptocurrency has also proved to be a volatile investment. The soaring price has raised concerns that Bitcoin is due for a dramatic correction, as happened three years ago when the value collapsed after a bull run.

During the rally in 2017 Bitcoin came close to breaking through the $20,000 level, only to hit extreme lows and fall below $3,300. It passed $19,000 in November last year before dropping sharply again.

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