Bitcoin rocketed to a fresh record high on Saturday, soaring past $60,000 (£43,100) for the first time ever.
The cryptocurrency climbed more than 5% to a high of $60,322.60, according to Coindesk, continuing its stellar rally this year. The move passed the previous all-time record of around $58,330 set on 21 February.
Bitcoin has surged more than 65% last month alone, and over 100% this year.
In late February, it saw a retreat to as low as $43,000 amid uncertainty in the traditional markets over stimulus expectations and their positive effects on US bond yields.
However, on Thursday US president Joe Biden announced that he signed a long-awaited $1.9trn (£1.3trn) coronavirus relief package, which will give individual American’s their third stimulus checks worth $1,400.
Analysts expect “higher volatility in the stock market” in the coming weeks as a result of Biden’s move, which has bolstered optimism in financial markets.
“It is highly likely that we will see another episode of stock volatility that we experienced back in December. But this time, it could be on a much larger scale,” chief market analyst at AvaTrade, Naeem Aslam said. “Americans are likely to get their checks from next week.”
The market value of all bitcoin in circulation hit $1trn for the first time last month, data website CoinMarketCap revealed. In December it soared past Visa to make it the world’s largest financial service.
In February, Tesla invested $1.5bn in bitcoin, and said it may even start accepting it as payment for its products.
The automotive company’s founder Elon Musk also commented that investing in Bitcoin is a “less dumb form of liquidity than cash”.
“To be clear, I am not an investor, I am an engineer,” he said on Twitter. I don’t even own any publicly traded stock besides Tesla.”
He added: “However, when fiat currency has negative real interest, only a fool wouldn’t look elsewhere. Bitcoin is almost as bs as fiat money. The key word is “almost”.
Musk also defended Tesla’s move to invest by saying Bitcoin is “adventurous enough for an S&P 500 company.”
Bitcoin started 2020 at around $7,000 per coin. Despite its rise in the last year, the cryptocurrency remains extremely volatile and experts continue to remain sceptical about using it as an investment.
However, a survey published last month showed almost two-thirds of UK investors intend to buy bitcoin in 2021.