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As bitcoin skyrockets, is a bubble at hand?

As bitcoin skyrockets, is a bubble at hand?

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A customer makes a purchase using bitcoins.

Bitcoin prices have seen a strong rally this this week in the run-up to and following a U.S. Senate hearing on Monday, which has been interpreted favorably by traders, but the sheer size and speed of the rally has reignited fears of a bubble in the market.

(Read MoreBitcoin hits $750, up 107% in a week)

On Tuesday, bitcoin prices touched a fresh record high of over $900 on the Mt. Gox exchange, a 6,445 percent increased on its value in January, when it traded at $13.75. However, it was a volatile morning that saw the currency plunge to $531 before recovering to around $793 by lunchtime trade in Asia.

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US authorities see benefit of bitcoin
At a U.S. Senate hearing on the controversy and risks surrounding Bitcoin, U.S. officials expressed optimism over the virtual currency. CNBC’s Mary Thompson reports.

“Bitcoin does have some compelling things…that allow for it to be quite intriguing – but in terms of the price it’s got way ahead of itself here in the short run,” David McAlvany, CEO of McAlvany Financial Group told CNBCAsia’s Squawk Box on Tuesday.

Meanwhile, Beat Wittmann, CEO of TCMG Asset Management, also told CNBC he would not be dabbling in the market: “I don’t think (bitcoin will become a legitimate and regulated currency). It wouldn’t be something I’ll be playing,” he added.

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This entry was posted on November 19, 2013 by and tagged .

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bitcoinvancouver2013@gmail.com

bitcoinvancouver2013@gmail.com

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