Defying naysayers, Bitcoin's price surged above $4,500 for the first time early Thursday to reach a market value of $73.6 billion.

While the cryptocurrency has since pared some of its gains, falling to $4,453 by midday Thursday, it's risen by about $1,000 in the past nine days. The currency's total market value jumped $17 billion in the same period, thanks in part to the optimism traders have around plans to help Bitcoin eventually go mainstream. This includes speedier transactions, starting with its software updatedubbed Segwit2xearlier this month.

We can also speculate that it is related to the increased interest from Korean and Japanese exchanges where volumes are also increasing, William Mougayar, the founder of Startup Management, told Fortune. Another part of it is driven by the psychology of markets, as $USD 5,000 seems to be within reach, now that the $4,000 level has been easily broken.

That said, Bitcoin's sudden rise is cause for concern for some.

Goldman Sachs analyst Sheba Jafari wrote in a Sunday note that she expected Bitcoin to potentially hit and peak at $4,827.

"The market should in theory enter a corrective phase. This can last at least one third of the time it took to complete the preceding advance and retrace at least 38.2% of the entire move," she wrote. "From current levels, that would measure out to around $2,221."

Meanwhile, plans to scale up Bitcoin haven't exactly gone smoothly. Miners still appear split about how to implement SegWit2x. The first part of that plan was activated earlier this month, but the second part, an upgrade to Bitcoin's software by increasing block size to two megabytes in November, has been a point of contention. That upgrade, which was made official this week, will result in a "hard fork."

Miners already dissatisfied with Segwit2x decided not to make that upgrade earlier this year, forming a new cryptocurrency offshoot dubbed Bitcoin Cash. If more miners shun the November upgrade, it would in theory result in yet another Bitcoin currency.

Bitcoin Cash is trading at about $373.80, 47% off its all-time high earlier this month. Ethereum, on the other hand, is trading at about $289, 26% off its all-time high earlier this year.

Read more:
Bitcoin Surged to a New High Adding $17 Billion in Just Over a Week - Fortune

The Poloniex exchange recently announced that it will finally enable BCH withdrawals on Monday. BreadWallet, the popular Bitcoin iOS wallet, will also support BCH transactions moving forward. It will be interesting to see how things play out for Bitcoin Cash, sincethere is still a lot of negative animosity towardthis project.

It is good to see support for Bitcoin Cash growing, even though there are still people who feel itto be an abomination. The process of forking offthe main Bitcoin blockchain wasrather peaceful, though, and there is no real reason for any continued bad blood between thecommunities. However, it is perhaps difficultto see two currencies utilizingnear-identicalcode bases andsimilar names, and to not expect some degree of animosity to exist. Bitcoin Cash is an altcoin for now, and no one should haveany problem calling it one.

Whether BCHbecomes the longer blockchain of the two remains to be seen. The SegWit2x fork, potentially taking place thisNovember, remainsa point of contention. Some people feel this will be less of an issue as the Core developers have beenmaking life difficult for supporters of SegWit2x. The upcoming Core Client 0.15.0 will cut offSegWit2x nodes from the main blockchain altogether. This will likely exacerbate the tensionsand lead to another Bitcoin blockchain fork, which could have major repercussions for the network as a whole.

The decision to simply reject SegWit2x now that Segregated Witness activity haslocked in should not surprise anyone. Everybody knew the support forSegWit2x frommost Bitcoin Core supporters was simply a means to an end. SegWit will activateregardless, but the potential increase to 2MB blocks will not be supported by Core. However, the rejection of SegWit2x has already caused a fair bit of controversy.

Some of the worlds largest mining pools support SegWit2x specifically and may not necessarily back down fromthat concept anytime soon. Though itwould make economic sense for them to do so, this war of scaling solutions has been going on for quite some time now. If the mining poolsreally wanted to drive a point home, they wouldstick with SegWit2x and move their hashpower to the new chain when the Novembersplit occurs. At that point things wouldlook pretty bleak for Bitcoin Core. Do keep in mind this is all mere speculation and the end result may be very different from the waythings look right now.

On the positive side for Bitcoin Cash, Poloniex will finally enable BCH withdrawals tomorrow. It is unclear what repercussions this will have on the young cryptocurrency. It is possible we will see a BCH trading market in the future as well, although there is still no official word on that. A Poloniex trading market for Bitcoin Cash would be more than welcome, even though we do not advise that users store funds in exchangewallets for longer than absolutely necessary.

BCH support is also coming to the iOS BreadWallet app. ManyiOS users utilizethis wallet due to its elegance and powerful features. The integration of Bitcoin Cash is a major milestone for the community. Having more wallet support especially in the mobile department can only be seen as a good thing. Things are finally coming together for Bitcoin Cash.

Go here to see the original:
Poloniex and Breadwallet Will Support Bitcoin Cash Transfers - The Merkle

What a day for Bitcoin.

24 hours ago the cryptocurrency was trading below $3,700. About an hour ago it surged passed $4,000 and has no signs of stopping. Its now trading around $4,135.00. For reference, a week ago Bitcoin hit an all-time high as it passed $3,000 for the first time.

Check out the chart below to see what the price has done in the last 24 hours.

So the million dollarbitcoin question iswhy now?

Without wasting too much of your Saturday night with detailed analysis, here are a few possible reasons you can tell your friends during brunch tomorrow.

Two weeks ago Bitcoin went through a hard fork, and came out essentially unscathed. Sure, a bitcoin-clone called Bitcoin Cash was created, but its gotten a lot less attention than most people expected. A few days later Bitcoin locked in SegWit, a code modification that fixesmalleability issues and frees up space in blocks, allowing for more transactions to be stored in each one.

These two code-related developments have helped boost conference in Bitcoins future.

Another reason the ICO frenzy. The amount recently raised via initial coin offerings have now (at least temporally) topped amount raised via early stage venture capital. Just last week Filecoin raised $180 million in a few hours. Most investors have to convert fiat currency to bitcoin or other cryptocurrencies to participate in ICOs, which could be driving up the price (and providing some investors with their first taste of bitcoin).

Another reason Wall Streets new obsession is bitcoin. You cant watch CNBC for five minutes without seeing a trader or analyst give their opinion which is usually something insanely bullish like its going to be the best performing investment of the year. For better or for worse, statements like these are getting non-technically inclined investors interested in bitcoin, some of which are definitely buying coins for the first time.

So what happens next? No one knows. Bitcoin could crash 50% to $2,000 tomorrow or spike to $5,000 and I dont think anyone who truly knows crypto would be surprised at either option. E

veryone has a different opinion some say the bubble is oversized and should have popped months ago others think that bitcoin is currently just a fraction of what it could eventually trade at.

Whichever camp you fall in, heres one friendly reminder: dont invest more than you can afford to lose because if you ask anyone whos spent more than a few months in the cryptocurrency world theyll tell you its a roller coaster.

View post:
Bitcoin just passed $4000 - TechCrunch

The price of Bitcoin continues to rise, with the cryptocurrency now trading at over $4,000. It's only a matter of days since the price set at record when it passed $3,500, but this has now been broken already.

The surge has been driven by Japanese interest in the currency, and trading currently stands at just under $4,200. After something of a wobbly period, the rise in Bitcoin has been fuelled by investors seeing it as a quick way to make a healthy return.

The recent creation of Bitcoin Cash did not kill off the cryptocurrency in the way some feared. Rather the forking of Bitcoin seems to have renewed interest in the currency, and the current trading price means that Bitcoin has more than quadrupled in value. The market value of Bitcoin is around $64 billion at the moment.

It's not clear how long Bitcoin will be able to continue its seemingly inexorable rise, or quite when the bubble will burst -- for burst it must. Investors have ensured something of a rollercoaster ride with Bitcoin, and while many people have been able to make a decent return on their investment, there are plenty of others who have lost out.

While Bitcoin has risen in value by 7 percent over the last 24 hours, its counterpart Ethereum has dropped by nearly 4.5 percent.

Image credit: ulchik74 / depositphotos

Read the rest here:
Bitcoin breaks $4000 - BetaNews

Last updated: 20th March 2015

Bitcoin is a form of digital currency, created and held electronically. No one controls it. Bitcoins arent printed, like dollars or euros theyre produced by people, and increasingly businesses, running computers all around the world, using software that solves mathematical problems.

Its the first example of a growing category of money known as cryptocurrency.

Bitcoin can be used to buy things electronically. In that sense, its like conventional dollars, euros, or yen, which are also traded digitally.

However, bitcoins most important characteristic, and the thing that makes it different to conventional money, is that it is decentralized. No single institution controls the bitcoin network. This puts some people at ease, because it means that a large bank cant control their money.

A software developer called Satoshi Nakamoto proposed bitcoin, which was an electronic payment system based on mathematical proof. The idea was to produce a currency independent of any central authority, transferable electronically, more or less instantly, with very low transaction fees.

No one. This currency isnt physically printed in the shadows by a central bank, unaccountable to the population, and making its own rules. Those banks can simply produce more money to cover the national debt, thus devaluing their currency.

Instead, bitcoin is created digitally, by a community of people that anyone can join. Bitcoins are mined, using computing power in a distributed network.

This network also processes transactions made with the virtual currency, effectively making bitcoin its own payment network.

Thats right. The bitcoin protocol the rules that make bitcoin work say that only 21 million bitcoins can ever be created by miners. However, these coins can be divided into smaller parts (the smallest divisible amount is one hundred millionth of a bitcoin and is called a Satoshi, after the founder of bitcoin).

Conventional currency has been based on gold or silver. Theoretically, you knew that if you handed over a dollar at the bank, you could get some gold back (although this didnt actually work in practice). But bitcoin isnt based on gold; its based on mathematics.

Around the world, people are using software programs that follow a mathematical formula to produce bitcoins. The mathematical formula is freely available, so that anyone can check it.

The software is also open source, meaning that anyone can look at it to make sure that it does what it is supposed to.

Bitcoin has several important features that set it apart from government-backed currencies.

The bitcoin network isnt controlled by one central authority. Every machine that mines bitcoin and processes transactions makes up a part of the network, and the machines work together. That means that, in theory, one central authority cant tinker with monetary policy and cause a meltdown or simply decide to take peoples bitcoins away from them, as the Central European Bank decided to do in Cyprus in early 2013. And if some part of the network goes offline for some reason, the money keeps on flowing.

Conventional banks make you jump through hoops simply to open a bank account. Setting up merchant accounts for payment is another Kafkaesque task, beset by bureaucracy. However, you can set up a bitcoin address in seconds, no questions asked, and with no fees payable.

Well, kind of. Users can hold multiple bitcoin addresses, and they arent linked to names, addresses, or other personally identifying information. However

bitcoin stores details of every single transaction that ever happened in the network in a huge version of a general ledger, called the blockchain. The blockchain tells all.

If you have a publicly used bitcoin address, anyone can tell how many bitcoins are stored at that address. They just dont know that its yours.

There are measures that people can take to make their activities more opaque on the bitcoin network, though, such as not using the same bitcoin addresses consistently, and not transferring lots of bitcoin to a single address.

Your bank may charge you a 10 fee for international transfers. Bitcoin doesnt.

You can send money anywhere and it will arrive minutes later, as soon as the bitcoin network processes the payment.

When your bitcoins are sent, theres no getting them back, unless the recipient returns them to you. Theyre gone forever.

So, bitcoin has a lot going for it, in theory. But how does it work, in practice? Read more to find out how bitcoins are mined, what happens when a bitcoin transaction occurs, and how the network keeps track of everything.

The above table is an advertising unit. For more options, please see our guide to buying bitcoin.

Follow this link:
What is bitcoin? - CoinDesk