WHO’S BUYING BITCOIN BOON?

Cyber currency hits all-time high

Bitcoin, the volatile cryptocurrency, is the new gold rush.

The price of the digital currency surged — and fell and surged again — yesterday in a frenzy that lit up the internet.

The price of a single bitcoin was over $17,000 about 5:30 p.m. yesterday, according to Coinbase, a bitcoin service, an almost $4,000 rise in just a day. A morning spike eclipsed $19,000 followed by a steep drop shortly after.

“Certainly there’s more attention to bitcoin right now, and the higher the price goes, there’s more attention,” said Neha Narula, director of the MIT Media Lab’s Digital Currency Initiative. “With that excitement comes attention, comes investment.”

But there’s a negative side to bitcoin’s electric growth.

Interest and demand were so high yesterday that Coinbase had to suspend service and transactions at one point.

Kyle Powers, founder of bitcoin company LibertyX, said short-term price surges have been common as the cryptocurrency becomes more popular. Boston-based LibertyX, which allows cashiers at retail stores to sell bitcoin to customers, has seen “an acceleration” in transactions in recent weeks, Powers said.

Many still see more hype than hope in bitcoin.

“It’s not a question of if it is a bubble, it is,” said Mark Williams, a finance professor at Boston University and longtime skeptic of bitcoin. “It’s just a matter of when it will pop.”

At the beginning of the year, one bitcoin was less than $1,000. Bitcoin has risen more than 2,100 percent since then.

“It’s really just a focus on who can get in fastest and who can make the most money,” Williams said. “At this point there’s been a big rush to get in and profit from it.”

The supersonic growth comes after bitcoin hit $10,000 for the first time just last week. The excitement of hitting a milestone number combined with a recent SEC decision to allow trading of bitcoin futures contracts in the coming weeks have led to a price spike fueled by frenzy on top of a new kind of legitimizing from the government.

Bitcoin futures will start trading on the Chicago Board Options Exchange on Sunday evening and on the Chicago Mercantile Exchange a week later.

That on its own could drive the price down, but the SEC decision to allow trading was an inherent endorsement of the digital money.

Bitcoin is the world’s most popular virtual currency with no bank or government ties.

The coins are computer code digitally signed each time they are traded.