Bitcoin set to hit $13,000 as Facebook crypto plans boost market
The price of Bitcoin is on course to surge past the $13,000 mark with plans from Facebook to launch a cryptocurrency in 2020 giving investors in the digital coin market a fresh boost.
The world’s most popular cryptocurrency has seen its price soar by more than 40pc in the last week, rising 14pc on Wednesday alone to $12,900.
The activity around Bitcoin comes just one week after social media giant Facebook announced plans to introduce a global cryptocurrency called “Libra”.
The company says the currency could be used by its billions of users across services such as Messenger, WhatsApp and Instagram to make online payments.
Mark Zuckerberg, chief executive of Facebook, said it was the company’s goal to “make it easy for everyone to send and receive money just like you use our apps to instantly share messages and photos”.
Cryptocurrencies are a form of online currency used to make transactions that don’t need to go through a centralised authority such as a bank.
Payments are carried out through a technology known as the blockchain. This is a decentralised, peer-to-peer system that keeps a record of all payments made through a network of connected computers.
The digital coin market reached an all-time high at the end of 2017 when the price of bitcoin reached $20,000, but suffered a heavy fall last year, wiping $700bn off the cryptocurrency market’s entire valuation.
Bitcoin has climbed in price by more than 200pc since December, but the persisting volatility in the market has led to the sector being labelled as the “wild west” due to the unpredictable nature of movements in the market.
Despite expecting some volatility to continue affecting the market, cryptocurrency investors are expecting greater institutional money flow into the digital asset class as more mainstream names such as Facebook get involved.
Earlier this year, JP Morgan announced its JPM Coin, a cryptocurrency designed by the investment bank to settle payments between its clients situated across the globe. The bank has however refrained from calling its coin a currency, claiming it “isn’t money per se”.