Bitcoin surges past $1,000 level

Value of virtual currency jumps as Zynga says it will accept it for online gaming

The price of the digital currency bitcoin has soared above $1,000 again as online gaming group Zynga says it will accept the currency. Photograph: Jim Urquhart/Reuters

The price of the digital currency bitcoin has soared above $1,000 again as online gaming group Zynga says it will accept the currency. Photograph: Jim Urquhart/Reuters

Mon, Jan 6, 2014, 09:06

The price of Bitcoin surpassed $1,000 again after Zynga said it would start accepting the virtual currency for some of its online social, citing wider use of the digital money. Bitcoins, which exist as software and aren’t controlled by any country or banking authority, surged to about $1,119 on the Mt.Gox online exchange, one of several markets where they are traded for dollars, euros and other currencies. Bitcoins first crossed the $1,000 threshold in late November and reached record at $1,238 on Mt.Gox on December 4th, but then plummeted to as low as $640 after China’s largest online market for the virtual currency stopped accepting deposits. The digital currency has rebounded as more merchants accept Bitcoins for everything from Gummi bears to smartphones on the Internet. Zynga is the latest merchant to accept Bitcoins, which can be used to buy virtual items in games.

“Bitcoin has been remarkably resilient in the face of all the bad news out of China,” Nicholas Colas, chief market strategist at ConvergEx Group, wrote in an e-mail. “The strength shows a continued interest, which is a very positive sign.”

Bitcoin was trading for about $13 a year ago, before wider acceptance and speculators drove prices higher. The rally gained steam in October, after regulators shut down the Silk Road Hidden Website, where people could obtain guns, drugs and other illicit goods using Bitcoins. That generated optimism the digital money would become more widely used. In November, law enforcement and securities agencies said in US Senate hearings that Bitcoin could be a legitimate means of exchange.

Dani Dudeck, a spokeswoman for San Francisco-based Zynga, confirmed a reddit.com community website post by the company introducing a plan to test Bitcoin payments. Players will be able to pay via the BitPay payments service for players of FarmVille 2, CastleVille and other games, Zynga said. “We look forward to hearing from our players about the Bitcoin test so we can continue in our efforts to provide the best possible gaming experience,” Zynga said.

Bloomberg

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