Is the bitcoin price surge a bubble?
Bitcoin made a new high this week of $19,857, topping its December 2017 record of $19,783.

Bitcoin made a new record high this week, but it has been a characteristically wild ride. The cryptocurrency eclipsed $19,857 (£14,897) on Monday, topping its December 2017 high of $19,783.
That came after last week’s three-year high of $19,374, which was followed by a stomach-churning 14% plunge in a single day. Bitcoin has gained more than 170% so far this year.
The latest surge suggests that cryptocurrencies are overcoming the “credibility hump”, writes Sam Benstead in The Daily Telegraph. PayPal recently announced that it will let customers use bitcoin.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Institutional investors and hedge-fund managers have started to talk about the currency in more positive terms. It is sometimes dubbed “digital gold”: a key attraction is that unlike fiat currency, bitcoin cannot be debased. Only 21 million bitcoins will ever be created.
Google searches for “bitcoin price” have surged to the highest level since June 2019, says Omkar Godbole on coindesk.com. Yet searches are still running at only one-fifth of the level they reached during the bitcoin frenzy of late 2017. That suggests that while there is some froth around, institutional investors are playing a larger role in this rally than they did last time.
A monetary revolution
I have previously compared the buzz around bitcoin to 17th-century “Tulipmania”, says John Authers on Bloomberg. “Tulips, I averred, are at least rather pretty.” Yet unlike investment tulips, which collapsed into obscurity in February 1637, bitcoin “keeps coming back for more”.
There are still reasons to be sceptical, says Izabella Kaminska in the Financial Times. Far from the utopian “decentralised network” desired by its early proponents, bitcoin has become “just another highly intermediated and intensively regulated financial service”. Slow and expensive transaction costs make it a poor fit for the role of digital cash.
And yet as physical cash disappears, enabling governments and firms to encroach ever further into our lives, the appeal of cryptocurrency is only growing. For those who fear that “civil liberties cannot be taken for granted”, bitcoin’s “anonymous security” offers a “doomsday contingency system”.
The rich will increasingly see bitcoin as an attractive store of value, says Niall Ferguson on Bloomberg. The combined wealth of the world’s millionaires was $128.7trn in 2018. If they invested 1% of that in bitcoin, the price could rise to $75,000. Covid-19 has only expedited the world’s rush online, achieving in “ten months” what “might have taken ten years”, which has further cemented the status of cryptocurrencies. “We are living through a monetary revolution so multifaceted that few of us comprehend its full extent.”
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019.
Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere.
He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful.
Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.
-
Millions of state pension records ‘set to be deleted’ – putting thousands at risk of never getting their money
Thousands of families could miss out on money owed to them if the government deletes historic state pension records.
-
What makes you wealthy in the UK? Could it make you a target in Rachel Reeves’ Budget?
Wealthy Brits could be at risk from a Budget tax raid – but how much money do you need to be considered wealthy in the UK?
-
Pierre-Édouard Stérin wants to make France great again
Conservative billionaire Pierre-Édouard Stérin is seeking to lead a political and spiritual renaissance across the Channel. The planning looks meticulous
-
Global investors have overlooked the top innovators in emerging markets
Opinion Carlos Hardenberg, portfolio manager, Mobius Investment Trust, highlights three emerging market stocks where he’d put his money
-
Pinewood Technologies: a drive for growth
Pinewood Technologies’ platform is one of the best in the business. Investors should buy in
-
'EV maker Faraday Future will crash'
Faraday Future Intelligent Electric is failing dismally to live up to its name, says Matthew Partridge
-
Investors should cheer the coming nuclear summer
The US and UK have agreed a groundbreaking deal on nuclear power, and the sector is seeing a surge in interest from around the world. Here's how you can profit
-
8 of the best houses for sale with follies
The best houses for sale with follies in the grounds – from a five-storey Victorian Gothic tower in Tonbridge, Kent, to a former mill in Oxfordshire with gardens that include a folly on an island in a lake
-
A tale of two Reits – why performance matters for valuation
AEW UK and Regional are two Reits that are valued very differently, despite a shared focus on properties outside London
-
Healthcare stocks look cheap, but tread carefully
Shares in healthcare companies could get a shot in the arm if uncertainty over policy in the US wanes, but are they worth the risk?