The online peer-to-peer digital currency Bitcoin (BTC) has cracked the US$1000 barrier on its largest currency exchange, and constant demand is driving prices higher than ever before.
The cost of a single Bitcoin has risen by more than 36 times since March, when 1 BTC was worth approximately US$30. Media attention and ever-increasing demand from Chinese investors and speculators has led to a massive increase in the price of Bitcoin in recent days and weeks, and it doesn't look like it's slowing any time soon.
Bitcoin itself is extremely new in monetary terms. After the genesis block was calculated on January 3 2009, the first semi-official exchange rate was pegged in October 2009 at US$1 per 1309.03 BTC; that's $0.000764 per Bitcoin. Bitcoin only hit parity with the US dollar, with 1 BTC costing US$1, in February 2011. In February this year, Bitcoin smashed through its previous record high to reach US$32 per coin. And now it's at US$1000.
Part of the appeal of Bitcoin is its mystery. The Bitcoin.org domain name was registered in August 2008, a theoretical paper on the subject was authored by a Satoshi Nakamoto in October that year and Bitcoin was registered as a project on the SourceForge open-source code repository in November.
Since then, no one has heard from the digital currency's creator, who is likely to have used a pseudonym for his online activities. The original 50 Bitcoin genesis block has sat untouched, in a publicly visible wallet since it was created. That 50 Bitcoin unit is now worth over US$50,000.
At a current price of AU$1200 at the time of writing, with a 24-hour low of AU$1011, the currency is volatile even on a daily basis. Anyone who bought into the currency or mined it early, when it was available for mere cents per Bitcoin, has made themselves a tidy profit if they care to sell soon.
Here's some more perspective: the 144,000 Bitcoins seized by the FBI when it arrested Ross Ulbricht, the founder of underground online marketplace Silk Road, were worth US$28.5 million when seized in late October. One month later, they're worth more than US$148 million.