Bitcoin smashes new record … then dips

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People have flocked to the cryptocurrency after a dire prognosis of the state of the US economy — but as always it was a rollercoaster ride.

Bitcoin has once again made history just past 1am on Thursday AEDT after it surpassed its all-time high from two days ago to reach a new one.

The highest the digital coin has ever sold for now stands at US$69,044, according to CoinGecko.

Bitcoin has smashed records over the last month after being listed on the New York Stock exchange through a futures exchange traded fund (ETF), however, the new spike in price is because of something else entirely.

The US government released its monthly report into the state of inflation and found it had surged to a 31-year high in the embattled country.

Bitcoin rode the wave amid inflationary fears, with investors piling in.

Within 45 minutes of this announcement on Wednesday, local time, bitcoin’s price skyrocketed by around $2,500, a four per cent increase.

However, at time of writing, the volatile coin had dipped substantially over the last several hours, to $US64,750.

The inflation report found a 6.2 per cent increase in the cost of living in the US over the past year — the most since December 1990.

Fuel, groceries and, surprisingly, used cars were the hardest hit by price hikes for US households.

But that was good news for those with bitcoin, as people scrambled to get their hands on the digital currency, which claims to be immune to inflation.

There is a limited supply of bitcoin, meaning it can’t be impacted the same way physical currency can be after the bank prints more money.

Bitcoin inventor Satoshi Nakamoto capped the number of bitcoins at 21 million, meaning there will only ever be 21 million of the coins in existence.

This was backed by a financial expert; Bitbank analyst Yuya Hasegawa said inflationary concerns was propelling bitcoin to new heights, Forbes reported.

Bitcoin has a market capitalisation of US$1.2 trillion.

The blockchain went from the fringes to the mainstream earlier this year, with its price rising 346 per cent in the last 12 months.

On Tuesday, the world cryptocurrency market became worth more than US$3 trillion for the first time ever.

Other cryptocurrencies have also had a strong week, with ethereum, the second largest blockchain, up 2.1 per cent according to CoinMarketCap.

Binance rose by 13.45 per cent over the last seven days while cardano also experienced a 4.8 per cent gain.

Originally published as Bitcoin smashes new $69k record amid US inflation fears … then dips