Bitcoin jumps to record $28,600 as 2020 rally reaches new heights

Bitcoin on Wednesday jumped to a record $28,599.99, after the digital currency almost quadrupled in value this year amid heightened interest from bigger investors.

The world’s most popular cryptocurrency was last up 2.3 per cent at $28,012. It has surged by nearly half since breaking $20,000 for the first time on December 16.

Bitcoin has increasingly seen demand from larger U.S. investors in particular, attracted by its perceived inflation-hedging qualities and potential for quick gains, as well as expectations it would become a mainstream payments method.

Investors said limited supply of bitcoin - produced by so-called “mining” computers that validate blocks of transactions by competing to solve mathematical puzzles - has helped power upward moves over recent days.

Many recent entrants to the market are holding onto positions, they said.

“The supply side to the bitcoin market will remain tight,” said Jacob Skaaning of crypto hedge fund ARK36.

The latest gains took bitcoin’s market capitalisation past $518 billion, according to industry website CoinMarketCap.

Other major cryptocurrencies, which tend to move in tandem with bitcoin, were flat. Ethereum, the second biggest, was down 0.4 per cent, on track for a 2020 gain of around 465 per cent.