The Bitcoin exchange rate has rocketed after a wild weekend.
Today’s price for a Bitcoin is US$673.879 or £476.552 – a slight fall on almost breaking the $700/£500 ceiling.
Over the past few days, the price surged to within a whisker, briefly sitting at $497/£491 sinking back a little.
In a month, the Bitcoin price has leapt by close to a third from the $450/£318 mark to the current level.
The online currency has not reached such heady heights since February 2014, when the exchange rate last broke through the $700 milestone.
Before that, the rate had soared to a lofty $1,100.
Exchange rate turmoil
The Bitcoin rate always seems in turmoil.
A year ago, a Bitcoin was worth around $230/£162.
The boost in value is put down to the Bitcoin halving later this month.
Bitcoin mining software automatically cuts the number of available coins when a present level is reached – and that level is expected to trigger a slowdown in the generation of new Bitcoin from the end of this month.
The software will put the brakes on mining to cut the generation rate by 50%.
Bitcoin miners who solve a complex mathematical problem release a reward of 25 Bitcoin, but this will drop to a payment of 12.5 Bitcoin in around 25 days if mining continues at the current rate.
Safe haven for Chinese investors
Although Bitcoin lies outside the control of a government or central bank, the coders who devised the virtual currency built in a monetary policy that controls output with the halving and other controls that eventually cap production.
The number of new Bitcoin is restricted to 210,000 every four years or so with a maximum limit of 21 million for ‘minting’ by miners.
In a rush to beat the expected price surge which comes with restricted demand, some Bitcoin investors are cashing in their chips, while others are seeking to extend their portfolios.
Much of the trading activity is down to Chinese investors, according to Bitcoin experts.
Commentators claim investors are concerned with the mountain of corporate debt weighing down the Chinese economy.
“As a result they want to get of the renminbi/yuan and move to something that is more of a safe haven for their cash,” said Charles Hayter, chief executive of virtual currency web site CryptoCompare.