Bitcoin is starting the year by rising above $1,000 for the first time in three years after its value reached $1,163 in 2013. With this, it outperformed all central bank issued currencies by having a 126 percent climb in 2016 according to Reuters.
Bitcoin is web based and is known to be a volatile currency. After a hack on the Tokyo based Mt. Gox exchange after its $1,100 peak, it fell below $400. Now hotly sought in China and some African countries, it has received a boost with an average 10 percent growth in 2016. The recession in countries like Nigeria and the election of Donald Trump in the United States have somehow contributed to the growth of Bitcoin especially into the last quarter of 2016. Uncertainties in central bank issued currencies including the Chinese Yuan which is at its weakest point in 20 years have mostly contributed to the rise in demand of the digital currency.
In India where Prime Minister Narendra Modi removed high denomination notes from circulation, Paul Gordon, a board member of the UK Digital Currency Association and co-founder of Quantave told Reuters that “the growing war on cash, and capital controls, is making bitcoin look like a viable, if high risk, alternative,” Paul’s firm I must add is one of those trying to make it easier for individuals and companies to trade in digital currencies.
With increased demand, there are now 12.5 bitcoins added to the systesm every 10 minutes to cater for the demand. Bitcoin is now valued at $16b and as Reuters puts it, the same as that of an average FTSE 100 company.