How currency of the internet bounced back

POLITICAL uncertainty has caused the value of Bitcoin - the so-called digital cash for the internet - to hit a three-year high of £730.

Created in 2009, Bitcoin is a type of digital currency with no central bank or controlling organisation but with individuals using the cash through computer programmes.

All transactions are recorded permanently on a ledger known as the ‘blockchain’ but there is no organisation ‘in charge’ of the system.

To ensure the system has value, no more than 21m Bitcoins can ever be created (unlike banks and governments which can print more money) so their value can fluctuate wildly depending on supply and demand.

The online cash system soared in popularity at launch with the price of a single coin reaching a peak of £916.19 in November 2013.

But a series of hack attacks and ongoing concerns about fraud and safety have dragged the value of the currency back. The cost of one Bitcoin was just £354 at the start of the year.

But experts say the fall in value of the Chinese Yuan – which is down about 7pc against the dollar over the past year – and moves by the Indian government to control its paper currency have started to drive the price of Bitcoin up again, with many organisations and internet traders moving to Bitcoins to secure the value of their cash.