Bitcoin has reached a three-year high after breaking through $18,000, with analysts predicting it could climb higher.
The leading cryptocurrency has seen value surge 160 per cent this year, climbing 70 per cent since September alone.
Bitcoin has rallied to $18,123, nearing the $19,763 all-time high it reached in December 2017. This surge takes the leading cryptocurrency’s total market capitalisation to over $315bn just below its $335bn record.
“It is only a matter of time before Bitcoin trashes an all-time high. In fact, it is highly likely that we will touch that price level this week,” said Naeem Aslam chief market analyst at Avatrade.
Demand for the most popular cryptocurrency has surged this year with investors using it as an inflationary hedge in the face of continued fiscal stimulus.
Bitcoin proponents say that because supply is capped at 21m it provides an innate value and protects it from policies that stoke inflation.
During volatile periods investors flock to safe havens, including gold and cash, but some now feel cryptocurrencies are a shelter from market uncertainty.
“Bitcoin seems to have everything going right for it,” said Edward Moya, senior market analyst at Oanda. “Mainstream acceptance is improving, President-elect Biden appointed Gary Gensler, someone viewed as friendly towards cryptocurrencies, to lead his financial policy transition, and steady institutional interest.”
“Bitcoin seems like it might have enough momentum before the end of the year to make that run towards the $20,000 level,” he added.