Economy - - Mar 03,2017
On Thursday, digital cryptocurrency Bitcoin exceeded the value of gold when it closed at $1,268.
The value of the volatile digital currency moved upwards reaching a landmark which has surprised the global economic sector. A single unit of Bitcoin has surpassed the value of an ounce of gold.
On Thursday, the exchange price for one bitcoin spiked up $33.36 to $1,263.72, according to CoindDesk's bitcoin price index. On the other hand, the trading value of an ounce of gold shot up $1.70 to $1,233.30.
The sudden rise of the digital currency is attributed to the rising demand in China.
It has been noted that, Bitcoin value has climbed more than 25 percent since that start of this year. Whereas, gold is moving up by a little more than 7 percent.
Since 2009, Bitcoin has established its stand by permitting anonymous transactions. Currently, the digital currency is accepted by more than 100,000 merchants globally, with the presence of big firms such as Microsoft, Subway and Dish.
However, the value of Bitcoin has been volatile due to lack of government backing and regulation. In August 2016, the value of bitcoin plummeted after a hacker successfully stole millions of dollars enclosed in this digital currency.
According to experts, the current growth corresponds to a fading value of Chinese yuan. Moreover, bitcoin has indeed grown attractive to Chinese traders as it allows them to dodge currency controls.
The process of Bitcoin transactions is managed through a procedure called "mining", which involves a computer cracking a difficult mathematical problem including a 64-digit solution.
For every problem solved, a single block of Bitcoins is processed. Also, in addition, the miner is compensated with new Bitcoins.
At present, there are about 15 million Bitcoins in existence.