Bitcoin touches $29K as bumper crypto year closes

Bitcoin vaulted above $29,000 to reach yet another record level on the last day of 2020, showing no signs of slowing down its torrid December rally.The largest cryptocurrency climbed to as high as $29,292 before pulling back slightly to trade at $28,972 as of 11:30 a.m. in Hong Kong Thursday. It has advanced almost 50 per cent in December, on track for its biggest monthly gain since May 2019.

"Key to this rally is that it has been sustained over several weeks," said Matt Long, head of distribution and prime products with crypto brokerage OSL in Hong Kong. "If we do see a break to the downside, it will be instructive on the direction of first-quarter flows whether we see institutions continue to buy on a potential dip." Bitcoin has now quadrupled in value this year amid the global coronavirus pandemic, while the wider Bloomberg Galaxy Crypto Index tracking the largest digital currencies is up about 280 per cent as rival coins such as Ether have also rallied.

The latest price surge continues to divide opinion between those who view cryptocurrencies as a hedge against dollar weakness and inflation risk, and others who question Bitcoin's validity as an asset class given its speculative nature and boom-and-bust cycles.