Why Bitcoin’s $100,000 year never happened

But in America there are signs that professional investors have begun to embrace the world of cryptocurrencies. Earlier this year the Securities & Exchange Commission, the market watchdog, gave the green light to a fund that tracks the price of Bitcoin – giving investors even easier access to the digital asset and potentially opening the floodgates for more institutional money. 

Still, an uneasy relationship with global regulators remains a thorn in Bitcoin’s side. In May a warning from Chinese banking and payment industry bodies to financial institutions not to conduct virtual currency business contributed to a sell-off that resulted in a 13pc drop in the price by the end of the month. 

A tough rival 

Investors who bought Bitcoin at the beginning of this year and managed to hold their nerve through the sell-offs have made a chunky 64pc gain. But backers of the rival crypto Ethereum have done even better, recording an astronomical rise of 393pc. Proponents point to its faster transaction processing and less energy-intensive “mining” requirements. 

But Michael Kamerman of the trading platform Skilling said Bitcoin was unlikely to be dethroned. 

“Given its popularity, it has struggled to maintain momentum, especially against newer coins riding the wave of social media hype,” he said. “Bitcoin isn’t going anywhere, and the fact it is so established will maintain its popularity with traders, traditional finance institutions and blue-chip companies.”