Bitcoin, the popular cryptocurrency, hit $5,000 late Friday (Sept. 1) but then retreated 5 percent in late trading, according to news from Fortune.
According to the report, at the beginning of the year, the possibility of bitcoin hitting $5,000 per coin was laughable, but with the price marching higher all year, it suddenly became a reality, albeit a brief one.
At the beginning of 2017, bitcoin hit a high of $1,000 for the first time, noted the report. For the year, however, bitcoin is up 500 percent and close to 2,200 percent since the middle of 2015, when it traded around $220, noted Fortune.
There was no one reason for bitcoin to jump late last week, although Fortune speculated it is more of the same: speculation because of the popularity of cryptocurrency. Other reasons for the uptick according to Fortune include new financial products that are creating a lot of liquidity, increases in trading in Asian markets and institutional investors taking the cryptocurrency craze seriously.
The report noted that with it hitting $5,000 for a moment in time, it will likely spark more talk that bitcoin is in bubble territory and that the digital currency is poised for a major decline. Fortune stated that bitcoin surpassed $5,000 on an index that is used by Coindesk but not on other indexes, which is notable, given Coindesk’s index includes prices from exchanges in Asia, where prices tend to be higher than in the U.S. or Europe. The U.S.-only index Winkdex had bitcoin nearing $5,000 but not breaking through, noted Fortune.
In early August, bitcoin’s price was nearing an all-time high as well, which has since been passed. The surge then was being attributed to both a relief rally after the recent split of the cryptocurrency into bitcoin and Bitcoin Cash, and to new investors getting into the virtual currency space.