It's not just Bitcoin anymore...

May 24, 2017 By Natalie Sherman
New York
BBC News

The price of Bitcoin, a digital currency once located at the fringe of finance, has been rising to new records in recent months as digital assets move into the mainstream.

On Tuesday, it shot past $2,200 (£1,700), more than doubling from just two months ago. And a newer currency, Ethereum, has climbed even faster.

Industry members say uncertainty surrounding the value of global currencies, including the pound, is driving demand for alternative currencies.

The kind of technology that underwrites Bitcoin and newer entrants such as Ethereum, is also gaining, well, currency, as it gets put to new uses by developers and others looking to beef up cyber-security.

Policy changes in Japan and elsewhere in Asia have made it easier to trade. And of course, when it comes to price, interest generates its own momentum.

"It's a promising technology," says Joshua Rosenblatt, 34, a Nashville-based attorney at Frost Brown Todd, a midwestern law firm with offices in eight states. He is both an investor and works in the field. "The returns have been unreal and there's an aspect of not wanting to miss out on a bubble."

Industry growth

Bitcoin's market capitalisation shot past $30bn this month, as the price climbed.

Ethereum remains smaller at about $15bn, but it is growing too. The price spiked from less than $20 in March to about $170 today, according to CoinDesk, which tracks the two currencies.

Activity is also up. The number of daily trades in Bitcoin, which is more established, has rocketed from around 40,000 at the start of 2013 to more than 330,000 today.

About 2,700 participants attended an industry conference in New York this week, according to Michael Crosby, head of strategy for CoinDesk, which hosted the event.

Mr Rosenblatt, one of the people in attendance, works with smaller investment firms and start-ups, navigating issues relating to coin offerings and "smart contracts", which use similar technology to enforce and verify business transactions.

In the last year, the number of clients looking for that work has increased from one to about two dozen, he says.

"Our firm is kind of a middle America firm, so the fact that we're seeing that sort of interest speaks to how much the industry has grown," he says.

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