- Bitcoin has risen 80% so far in December
- Bitcoin rose to $17,900 on BitStamp on Friday
- Bitcoin rose nearly 20% in one week that ended on Friday
Outages on some of the world's biggest exchanges this week, which left millions of investors unable to access their funds during periods when trading volumes are high, have also fuelled concerns about the fragility of the market's infrastructure.
Five Things that you should know about the rise of bitcoin
1. Bitcoin reached as high as $17,900 on Friday on the Luxembourg-based Bitstamp exchange.
2. While bitcoin has added 20% of its value since Monday, trading has been slightly calmer than the wild price swings the market has seen in past few weeks, with volatility lower since the launch of bitcoin futures from Cboe Global Markets on Sunday.
3. A section of analysts said that the surge in price of bitcoin was driven by the launch of Cboe's rival CME Group's bitcoin futures contracts on Sunday. "The hope (is) that futures signal the unlocking of institutional money into the digital arena and (that there will be) a rapid demand increase and ratification of the technology and its principles," said Charles Hayter, founder of industry website Cryptocompare.
4. The sceptics call the surge completely "speculative". A study by Anglia Ruskin University, Trinity College Dublin and Dublin City University released on Friday said bitcoin could pose a threat to the financial stability of traditional currencies and markets. "Our evidence finds that the price of Bitcoin has been artificially inflated by speculative investment, putting it in a bubble," said Larisa Yarovaya, one of the report's authors and a lecturer at Anglia Ruskin University. "Although bitcoin is not regulated by governments, it could still have a knock-on effect on traditional markets due to the interconnectedness of cryptocurrency markets with other financial assets."
5. The proponents say that bitcoin's total market size -- around $300 billion -- mean the impact of any future price collapse would not be large enough to have a knock-on effect on financial stability. The BBC reported late on Thursday that the head of Britain's Financial Conduct Authority, Andrew Bailey, had warned that bitcoin buyers should be prepared for the possibility that they could "lose all their money".