One bitcoin is now worth more than twice as much as an ounce of gold. At $2,981.51 (£2,351.82), the digital currency has far outstripped the current $1,271.19 asking price for an ounce of the precious metal. While gold may be one of the most familiar alternative assets to an everyday investor, bitcoin is likely to be new territory. But those who purchase gold as a way to store value outside of a mainstream bank could also find bitcoin of interest.
The emergence of bitcoin has given rise to a number of other online coins, commonly referred to as 'cryptocurrencies', where encryption is used to regulate the number of units of the currency that can be created and to verify transactions. The underlying technology supporting bitcoin, the blockchain, is also being made use of in a number of industries, from asset management to property registration.
The idea for bitcoin was first aired around 2009 in a white paper detailing the proof of concept written under the pseudonym Satoshi Nakamoto, whose real identity or identities have never been revealed. This anonymity of the founder may seem like a red flag for would-be investors, but the protocol and software underlying bitcoin are published openly, allowing any developer to review the code. Just as no one owns the technology behind email, the bitcoin network has no owner or overall controller.