(BLOOMBERG) – Bitcoin, the world’s largest cryptocurrency, topped US$34,000, just weeks after passing another major milestone.<\/p>\n
The currency gained as much as 7.8 per cent to US$34,182.75, before slipping to about US$33,970 as of 3.05pm on Sunday in Singapore. It advanced almost 50 per cent in December, when it breached $20,000 for the first time.<\/p>\n
The latest gains top an eye-popping rally for the controversial digital asset in 2020, which rebounded sharply after a severe crash in March that saw it lose 25 per cent amid the coronavirus pandemic.<\/p>\n
The currency “will be on the road to $50,000 probably in the first quarter of 2021,” said Antoni Trenchev, managing partner and co-founder of Nexo in London, which bills itself as the world’s biggest crypto lender.<\/p>\n
Institutional investors returning to their desks this week will likely boost prices further after retail buying over the holidays, he said.<\/p>\n
Bitcoin has increasingly been “embraced in more global investment portfolios as holders expand beyond tech geeks and speculators”, Bloomberg Intelligence commodity strategist Mike McGlone wrote in a note last month.<\/p>\n
Proponents of the currency have also seized on the narrative that the coin could act as a store of wealth amid supposed rampant central-bank money printing, even as inflation remains mostly muted.<\/p>\n
Bitcoin should eventually climb to about US$400,000, Scott Minerd, chief investment officer of Guggenheim Investments, told Bloomberg Television in a Dec 16 interview.<\/p>\n
Still, there are reasons to be cautious, partly since Bitcoin remains a thinly traded market. The currency slumped as much as 14 per cent on Nov 26 amid warnings that the asset class was overdue a correction.<\/p>\n
The big run-up in price in 2017 was followed by an 83 per cent rout that lasted a year.<\/p>\n