The cryptocurrency has experienced some significant drops this year – falling to as low as $10,000 in September. Recently it has been back on the rise.
Bitcoin passed the $20,000 threshold on Wednesday, the first time it has reached this level since the cryptocurrency was created in 2008.
It jumped to as high as $20,440, according to latest estimates, climbing by 4.5 percent on 16 December.
Despite the ongoing pandemic and curtailed business activities worldwide, the digital asset grew 170 percent in 2020.
The currency saw some sharp drops during July and September, when it fell below $10,000.
Since then, the asset has been on the rise, hitting a two-week high in December and eventually breaking a record set by its previous advances in December 2017.
Back then, the currency stopped short of reaching the $20,000 mark.
The record-breaking news was met with excitement by the Gemini exchange co-founder Cameron Winklevoss:
The analysts believe that cryptocurrencies such as bitcoin have been especially attractive to investors because of their supposed immunity to inflation risks and decentralisation. Bitcoin has not been subject to any administrator or central bank policies, and has been deriving value from a so-called “mining” process.
Investment bank Goldman Sachs, however, remained sceptical about the currency’s overreaching powers, saying in May that bitcoin did not belong to an “asset class” and was generally “not a suitable investment” despite looking appealing because of “high volatility”.
The bank’s Investment Strategy Group also suggested back then that the currency was “conduit for illicit activity” and did not provide “consistent diversification benefits” to its users.
Bitcoin was invented in 2008 by Satoshi Nakamoto – a pseudonym which has been claimed by many people since the cryptocurrency’s foundation. Since then, the digital currency has been making advances through peer-to-peer transactions recorded by a blockchain.