Bitcoin price skyrockets past $70k for first time in months

For the first time in months, the cryptocurrency has clawed back some of its losses but expert are warning it’s still risky.

The price of bitcoin shot past $US50,000 ($A70,000) for the first time in more than three months as the broader crypto market continues to mount a strong rally after months of weakness.

The surge in value put its market capitalisation closer to the $1 trillion mark.

The digital coin rose by almost 2 per cent in 24 hours earlier, but by the end of Monday, it had retreated slightly, to $US49,251 ($A68,269).

Bitcoin’s now up almost 7 per cent from a week ago and more than 55 per cent compared with a month ago, when it was trading at around $US30,000 ($A41,000) per coin.

The crypto’s still down almost 26 per cent from its peak of more than $US64,000 ($A88,000) per coin that it saw in mid-April.

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PayPal has announced it will launch its cryptocurrency service in the UK. Picture: Jack Guez / AFP

Since hitting its all-time high, investors sold off bitcoin in June and July, pressuring the digital coin below $US30,000 ($A41,000) amid renewed government scrutiny in the US, China and elsewhere.

But bitcoin’s been marching steadily upward for about a month now as it’s increasingly recognised and embraced by politicians and the corporate world.

On Sunday, PayPal announced it will launch its cryptocurrency service in the UK, letting people buy, hold and sell digital currencies on the platform. It’s an expansion of the company’s service already offered in the US.

Sarah Coles, personal finance analyst at Hargreaves Lansdown said PayPal’s announcement is being seen by speculators as another sign of crypto being adopted by the mainstream.

But in reality, it’s not clear how many businesses will actually start accepting crypto through PayPal and many would transfer it back into currency to avoid any huge slides in value, she added.

“Bitcoin is clearly moving further into the mainstream, with central banks weighing up the launch of their own coins, and asset managers expanding their crypto offerings,” she told Financial News London.

“However, it remains an incredibly risky and speculative bet. Dramatic rallies and spectacular falls are a hallmark of any market driven entirely by speculation, so the rollercoaster ride is a long way from over.”

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Experts have warned that cryptocurrency is still speculative and risky. Picture: Nicolas Tucat/AFP

Last week, crypto exchange Coinbase announced that it will buy $US500 million ($A693 million) in crypto on its balance sheet, and begin to invest 10 per cent of its total profits into a crypto assets portfolio.

“Hopefully over time we can operate more of our business in crypto,” CEO Brian Armstrong said on Twitter. “Today it is still a mix.”

Other companies, including Elon Musk-helmed Tesla and Microstrategy, have also invested corporate funds into cryptos, calling it a hedge against inflation.

Along with bitcoin, other crypto assets have recently swelled in value, too.

Ethereum was last seen trading at almost $US3340 ($A4630), up more than 2 per cent from 24 hours ago and almost 65 per cent from a month ago.

Binance coin traded at about $US498 ($A690), up almost 9 per cent from a day earlier and over 69 per cent from a month ago.

The crypto market overall commanded a value of about $US2.16 trillion ($A2.9 trillion) as of Monday morning, according to CoinMarketCap.com, up over 2 per cent from a day earlier.

This article originally appeared on the New York Post and was reproduced with permission