For the first time, a unit of the digital cryptocurrency Bitcoin climbed above that of a troy ounce of gold.
Bitcoin has jumped by nearly 33 percent this year and 200 percent over the past 12 months, where it closed at $1,268 on Thursday while a troy ounce of gold stood at $1,233.
The increase in value of the Bitcoin amid a surge in interest in China where authorities are concerned the digital currency is being used to facilitate capital flight from the country.
The comparison between gold and bitcoins is arbitrary, given the latter is a virtual currency and entirely abstract, whilst gold is measured in weight.
Since its launch in 2009, the value of them has been very volatile. Many experts have questioned how long the virtual currency will last for. It is an attractive form of currency for some due to its anonymity, as well as its lack of government control. Earlier this year, Chinese authorities cracked down on Bitcoin trading in an attempt to stop money flowing out of the country illegally.
Back in 2009, some said that bitcoin would eventually replace gold as the preferred alternative asset and store of value. This has not happened because it remains complicated to invest in bitcoin and it has a volatile price history.
The news that bitcoins worth climbed above gold could be a sign that more mainstream investors are allocating at least some portion of their alternative investment portfolio to the digital currency.
There are currently about 15 million Bitcoins in existence. To receive them, users require a Bitcoin address – a series of 27-34 numbers and letters – this acts as a virtual postbox where the coins are received and sent. Because there is no register of these addresses, people can protect their anonymity when making using the currency and making transactions.