Why is the price of Bitcoin going up?

The value of Bitcoin has been soaring in the past few months. — SlavkoSereda/IStock.com/AFP

Since the beginning of the fall, cryptocurrency prices have been soaring. On Nov 18 the Bitcoin price surpassed the US$18,000 (RM73,773) mark, an all-time high since the beginning of 2018. Its surge has prompted analysts to predict a new increase that could go even higher than the record, reached in December 2017 record, when a Bitcoin was valued at US$19,041. This phenomenon has to do with the fact that Bitcoins are somewhat of a "safe investment" for some, and also because online payment system Paypal recently authorised the use of this cryptocurrency on its platform.

As many governments worldwide are unveiling budget stimulus plans to relaunch their economies, in terms of investments the trend is currently toward risk-taking. Cryptocurrencies, with extreme exchange rate volatility, are increasingly wooing investors. Perhaps surprisingly, they are perceived as a safe investment in the long run for some, like gold is for older generations.