Bitcoin Price Spikes to New Highs
It’s been a crazy ride for bitcoin, with the price per coin skyrocketing up to $900 and settling back down to over $600 on most exchanges (which is still an astronomical gain of over 400% since September).
So what’s fueling the bitcoin bump?
China, for one, is the home of the world’s largest bitcoin exchange (BTC China). The virtual currency has seen a growing interest in the country – and for good reason. The Chinese government staunchly opposed digital currencies that undermine government control, even dragging prepaid cards into that net, but being decentralized and nearly anonymous, bitcoin is a workaround to financial regulation.
Most pressing perhaps, is the U.S.’ exploration of bitcoin during its Senate hearings being conducted the past week.
Ben Bernanke, chairman of the U.S. Federal Reserve, stated “In general, the Federal Reserve would only have authority to regulate a virtual currency product if it is issued by, or cleared or settled through, a banking organization that we supervise.” He continues to say that the Federal Reserve would be monitoring banking organizations for AML and Bank Secrecy Act requirements.
It seems that the U.S. government will generally be hands-off when it comes to bitcoin – unless either the business dealing with bitcoin, or the bank itself is non-compliant of current laws.
So this is a good thing for bitcoin. It has the quiet blessing of regulators, and the increasing adoption of Chinese consumers (50% of all bitcoins go through China daily), a country with an online transactional volume expected to surpass the United States’ this year.