Bitcoin is now officially more valuable than gold and experts are saying it’s mostly China’s fault.
On Friday, the price for the cryptocurrency soared to a record high, with a single bitcoin amounting to $1,280, Fortune reported. One bitcoin now costs $1,250 as of press time. Comparatively, an ounce of gold costs $1,219 as of press time.
Over the last year alone, the notoriously volatile cryptocurrency made an astonishing jump by over 200 times its value. Observers have noted that the growth of the digital currency’s value was greatly influenced by China’s currency, which began its a downward trend when Chinese money started pouring out of the country. The demand for the digital currency rose as the local currency dropped, driving up its value.
With bitcoin operating in an anonymous, decentralized system, it has allowed Chinese investors to evade government restrictions on moving money in and out of China. Interestingly, according to a report from the U.S.-China Economic and Security Review Commission, China has also become a major Bitcoin mining hub in the last few years, Quartz reports.
Despite the Chinese government’s supposed efforts to clamp down on the cryptocurrency, the volume of bitcoin use in the country has continued to climb as more and more Chinese keep mining and trading the digital currency. According to New York Times, 42% of all bitcoin transactions in 2016 occurred on Chinese exchanges.
When Bitcoin was created in 2008, it was known as a decentralized virtual currency, devoid of control of any single government or country. However, with a handful of Chinese companies effectively taking control of a significant network of Bitcoin production, the currency’s supposed decentralized identity is now being put into question.