Bitcoin’s market value surged past the $US1 trillion ($A1.27 trillion) mark for the first time as the world’s largest cryptocurrency continued its staggering rally.
The milestone came as the price of a single bitcoin rose to an all-time record of $US54,827 ($A70,000) shortly before noon, putting it up about 5.6 per cent from a day earlier, CoinDesk data show.
That means bitcoin is now worth more than all but a handful of the world’s publicly traded companies and accounts for roughly 61 per cent of the combined value of all cryptocurrencies in circulation, according to Coinmarketcap.com.
Bitcoin’s value has surged more than 82 per cent since the start of this year as a growing number of institutional investors and major companies started treating it like a mainstream asset.
Last month, Tesla wowed the investment community, with a $1.5 billion ($A1.9 billion) purchase of bitcoin to “further diversify and maximize” the return on its cash. Additionally, Tesla said it may invest more of its cash in digital assets, gold bullion, gold exchange-traded funds and other assets.
The digital coin got a boost from Tesla CEO Elon Musk, who said it was “a less dumb form of liquidity than cash.” His electric-car maker announced last week that it had bought $US1.5 billion ($A1.9 billion) worth of bitcoin and planned accept the cryptocurrency as payment.
Musk suggested that cryptocurrency had become a wise investment as central banks pushed interest rates on cash to near or below zero.
“When fiat currency has negative real interest, only a fool wouldn’t look elsewhere,” he tweeted, referring to a term for government-issued currency that’s not backed by a physical commodity like gold.
Musk’s latest bullish remarks about bitcoin came amid a growing perception that the digital currency offers protection from inflation.
Tesla isn’t alone. Mastercard has said it expects to support certain crypto transactions on its network this year, and BNY Mellon, the nation’s oldest bank, recently announced that it would start providing banking services for cryptocurrencies and other digital assets.
This story was originally published on the New York Post and is republished here with permission