Two years ago, Bitcoin’s value dropped so badly that the digital currency was canceled as a failed experiment.
Not anymore. Bitcoin has reloaded, and for the first time (2 March), a Bitcoin is worth more than a gold ounce troy.
The milestone is inherently arbitrary: if gold is traded in pounds or kilograms, Bitcoin would still have much to do. But the emergence of a new currency with the same value as the millennium gold is significantly significant.
The price of a bitcoin increased as high as $ 1,242 at the beginning of Friday, just two days after going over $ 1000 for the first time. Prices fell back to around $ 1155. Meanwhile, gold prices were around $ 1,250 per ounce, about 25% for the year.
Bitcoin has risen this year in the hope that the experiment with digital money will be a legitimate global currency. A bitcoin was worth about $ 13 in January.
Bitcoin, acting nonstop on Mt. Gox exchange and other online markets have been extremely volatile. It rose to what was then a full-time $ 900 earlier this month, just to fall back to $ 500 in the span of 28 hours.
Demand for bitcoin has been particularly strong in China.where the leading search engine, Baidu (BIDU), now accepts the currency for certain services.
In the United States, legislators have reviewed potential provisions for bitcoin, which is optional currency on some online markets for drugs and other illegal goods.
Last month, the federal authorities cut off the road to drug trafficking Silk Road, although a few weeks later a new version of the market appeared.
Bitcoin has received support from Federal Reserve officials, including President Ben Bernanke, who said the currency could “have a long-term promise” within the international payment system.
Some supporters argue that the regulation of the regime would be positive for the bitcoin as it could lead to wider adoption of the currency. But others say the bitcoin is decentralized by the project and the government should leave enough alone.
Investors say bitcoin is highly speculative and should not exceed 1% of the portfolio. Many compared the bitcoin with a lottery ticket, saying it could be worth a lot, or nothing.
Bitcoin prices rose in April after an unprecedented rescue of the banking system in Cyprus, which has led to concerns about the stability of European banks and the euro. In May, prices fell in what many saw as explosive bubbles. Bitcoin sold in the $ 100 range most of the summer before the start of the current meeting in October.
In the meantime, more and more companies are accepting bitcoins, ranging from underground sandwich shops to Richard Branson’s commercial travel program, Virgin Galactic.
The Bitcoin program was created anonymously and launched on the Internet in 2010. Unlike traditional paper coins, bitcoins are not managed by central authority and exist only in cyberspace.
Bitcoins are “extracted” by powerful computers that fill complicated math problems. The total number of bitcofs is limited to 21 million and about 12 million are currently in circulation, according to blockchain.info.
Bitcoin fans, crypto-currencies, have long been called digital gold. Now it sounds like an insult: continuing star growth and adding more than 30% value in just one week, one bitcoin worth over $ 2,600, more than double the amount of gold ounces. As The Economist went to push all the bitcoins in circulation were worth over $ 4.3 billion. The sum of $ 1,000 invested in bitco in 2010 is now nearly $ 36 million. Other crypto-currencies also go up: this week worth $ 87 billion. But if the history of gold is some kind of guide, what goes down, goes down, and then goes.