Bitcoin breaks $8,000 barrier for the first time

The price of the virtual currency bitcoin has broken the $8,000 barrier for the first time, as speculation mounts that it could cross $10,000 by the end of the year.

According to commentators, the increase means one unit of the world's first major cryptocurrency is now valued at over six times an ounce of gold, traditionally seen as a safe-haven investment in times of economic turmoil.

Bitcoin's value has been volatile even after several steep falls this year it has now surged ten-fold from around $800 at the beginning of 2017 to over $8,000 in the early hours last morning.

The cryptocurrency's latest spike, a month after it surged past $5,000, is linked to speculation about the likelihood of a ''hard fork'' to create a spin-off currency.

A fork expectation gives a boost to bitcoin because existing holders gain some of the new currency for free.

The market price of Bitcoin has been volatile in recent weeks following the cancellation of a technical upgrade known as SegWit2x, aimed at increasing transaction speeds.

The cryptocurrency exchange CoinBase said a large number of bitcoin ''miners'' – people who provide the computational power that underpins bitcoin in exchange for the chance of financial reward could now go ahead with their own upgrade, setting of speculation that this could trigger a fork.

Another reason cited for the increase is the fact that established investors and companies are increasingly venturing into the world of cryptocurrency in recent months.

Payments company Square started to allow customers to buy and sell Bitcoin earlier this week and the Chicago Mercantile Exchange said it would offer Bitcoin futures by the end of the year, a move that could open the currency to a host of institutional investors. Coinbase is targeting hedge funds and sovereign wealth funds with a new custodian service.