Bitcoin surges as cryptocurrency jumps $13 BILLION in huge rally

Prices for bitcoin rose to $10,000 (£8,000) on Friday morning, the first time it has hit that price since February, according to data from CoinDesk. The price of bitcoin had dropped to $3,750 (£2220) on March 13 — known as Black Thursday — but has since rallied by more than 160 percent. Similarly, stock markets which saw sharp drops in March have since recovered.

Prices for bitcoin rose to $10,000 (£8,000) on Friday morning, the first time it has hit that price since February, according to data from CoinDesk.

The price of bitcoin had dropped to $3,750 (£2220) on March 13 — known as Black Thursday — but has since rallied by more than 160 percent.

Similarly, stock markets which saw sharp drops in March have since recovered.

Bitcoin is not issued by a central authority like other curries are but is instead underpinned by a technology known as a blockchain.

So-called miners with specialised computers compete with each other to solve complex math problems to validate bitcoin transactions. Whoever “wins” the race gets a newly minted bitcoin. This activity happens in blocks, a group of transactions joined in one.

Every four years the value of bitcoin per block mined is halved, to keep on top of inflation.

So on May 12, the reward per miner will be cut from 12.5 bitcoin per block mined to 6.25.

This reduces the supply of bitcoin coming into the market, which in turn increases the price.

Proceeding previous halving events there has been a price increase in bitcoin.

Matthew Dibb, co-founder of Stack, a bitcoin index fund provider, told CNBC: “For the past few weeks, we have seen additional players enter the bitcoin market as prices have trended upward in anticipation of the halving event as bulls saw this as an opportunity to buy bitcoin ahead of a price pop and what many expect will be significant price appreciation.”

Vijay Ayyar, head of business development at cryptocurrency exchange Luno said: “We have gone from 3K to 10K in 2 months, too fast, too soon. There will be a pullback, and that will determine what kind of crash it is.

“We could pull back to 8K, hold, and them move higher to 15K. Or we could go right back down to 3K as well. At this point though, one has to be bullish, unless, we see a violent move down.

“I think the current run up though is part of a larger move up, so don’t think we’ll see 3K again anytime soon. But if we do run up to 15-20K, then likelihood of a big move down and larger correction is higher.”