Is Bitcoin’s 81% surge a bubble?
Bitcoin bubble bounces into SA
The crypto-currency is flying, thanks to Chinese buyers — but the yo-yo price underscores the deep risks involved
Investors who have taken the plunge into Bitcoin will be toasting the 81% surge in the price this year alone. But with the crypto-currency prone to huge price volatility, it remains a high-risk game. Surging demand in China has pushed the total value of Bitcoins in issue to US$29.5bn. Over the past 12 months, that’s a more than fourfold increase to a new high of $1,824/Bitcoin — almost $600 more than an ounce of gold. It’s a giddying trajectory for an imaginary currency which, five years ago, was selling for as little as $5. But is it too late to cash in? It depends on who you speak to. Aurélien Menant, CEO of Gatecoin, a Hong Kong-based Bitcoin exchange, sees a price of $3,000 by year-end. Another raging bull is Bobby Lee, CEO of Chinese Bitcoin exchange BTCC, who predicts that by 2020, the Bitcoin price will be upwards of $11,000.Of course, there are plenty of SA investors playing the Bitcoin game. This was given impetus after a 2014 position paper in which the SA Reserve Bank dec...
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