As Bitcoin has continued to gain in popularity and accessibility around the globe, its price has similarly grown. The digital currency, widely seen as one of the earliest and the most important in paving the way for the new cryptocurrency industry, has reached a landmark achievement. Continued growth in price has elevated the cost of a single Bitcoin to more than $2,000 for the first time in history. With that achievement, the total value of Bitcoin has likewise climbed to an astounding $32.92 billion.
Precipitous Gains for Bitcoin This Year
The price of Bitcoin has been on an ascendant path for many months. Still, the currency has been valued much more highly than many of its competitors for years: Bitcoin first broke the $1,000 valuation threshold about four years ago. In the immediate aftermath of that period, however, Bitcoin dropped in price. Some analysts have attributed the dip to the demise of the major exchange Mt. Gox.
The supply of new bitcoins is expected to end sometime after the year 2110, at which point there will be 21 million bitcoins in digital existence. At the recent market price, the total value of all of the electronic tokens that will ever exist is slightly less than $39 billion.
By the end of 2016, Bitcoin had regained its lost ground and was trading at $1,000 once again. This may have been due to broader support from large financial institutions, the continued development of blockchain services, and new regulations from China. What has happened in the start of the new year, however, has taken nearly everyone by surprise.
From $1,300 to $2,000 in Weeks
At the end of April, Bitcoin was trading for about $1,300 per coin. In just three weeks, the valuation has climbed by about 50%, as Bitcoin topped the $2,000 mark this week. About 12% of that gain was in the past week alone. This is a significant gain, but in fact is not one that is unique to Bitcoin among cryptocurrencies. Ripple, a centralized currency designed for use by big banks, has climbed by 1,000% in the past few weeks, catapulting it to the second spot among all similar currencies in terms of valuation, according to Tech Crunch. At the same time, Bitcoin competitor Ethereum has also climbed to $130 per coin, more than double what it was a month ago
The end result of the overall gains in valuation across the cryptocurrency field is that Bitcoin no longer represents the largest share of all digital currencies. As of this writing, Bitcoin's market value now represents about 47% of total digital currencies, whereas it was about 80% just a few months ago. And yet, Bitcoin remains the most prominent and recognizable of currencies in this area. Perhaps scaling is limiting Bitcoin's growth as compared with some of the other currencies that are on the rise. Scaling occurs when the currency has grown so large that users cannot quickly confirm transactions unless users attach hefty fees for miners.
And, at the same time, analysts are cautious about the possibility of a bubble, although it is extremely difficult to assess the actual value of a digital currency anyway.