Bitcoin price hits $500 as demand soars for virtual currency in China

Kasmira Jefford
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VIRTUAL currency Bitcoin soared over $530 to a new record high on the Mt Gox, one of the currency’s largest exchanges last night – almost doubling its value in the last 12 months.

The recent surge has been largely attributed to the digital currency’s rising popularity in China, where investors are becoming increasingly interested in its potential growth as an asset class. BTC China, the leading Bitcoin exchange in China, surpassed Japan-based Mt Gox last week in terms of trading volume for the digital currency.

The price of Bitcoin, which has a controlled money supply not backed by any central bank, hit $266 on 10 April, driven partly by the Cyprus banking crisis, fears over the security of traditional currencies, as well as regulators handing it new credibility.

It then crashed to $50 later that month and had not risen over $170 until last week.

On Tuesday Cameron and Tyler Winklevoss, investors in Bitcoin, said the currency could reach a market value of $400bn.