Is bitcoin’s 2020 rally another flash in the pan?

LONDON: Crypto analysts are split on whether bitcoin’s rise this year is driven by unique factors or is just its latest bout of volatility. But many agree on one factor: an upcoming cut to the supply of bitcoin.

Bitcoin has soared by almost half this year, to more than US$10,000, for the first time since October. On Tuesday it hit its highest in five months.

The cryptocurrency’s 11-year history is replete with fast ascents and equally rapid plunges. In late 2017, it rose three and a half times in just 35 days to reach almost US$20,000. It then slumped 70per cent in seven weeks.

Such wild and often inexplicable swings are why bitcoin faces a struggle to become a functioning currency.

This time around, some market players point to a confluence of drivers not seen before. Arcane tech factors, expectations for mainstream acceptance and macroeconomic trends are leading markets to look again at bitcoin’s worth, they say.

“You can argue…