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Bitcoin rebounds to trade at $600; 51% fears remain

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Investing.com -

Investing.com - Bitcoin bounced back on Monday to trade at the $600-level, but sentiment remained shaky amid indications a single user has begun to provide more than 50% of the computational power used to mine the digital currency.

BTC/USD rose to a session high of $610.00 on Slovenia-based BitStamp, before coming off the highs to last trade at $605.49 during U.S. morning hours, up 5.41%, or $31.10.

The price of a Bitcoin on Bulgaria-based BTC-e jumped 4.89%, or $27.86, to trade at $597.00, after hitting a daily peak of $603.99.

According to the CoinDesk Bitcoin Price Index, which averages prices from the major exchanges, prices of the crypto-currency advanced 1.59% to trade at $601.40.

Bitcoin sold off last week after reports revealed that mega mining pool GHash briefly contributed over 51% of the currency's hashing for the first time in history.

Market analysts believe that one of the biggest threats to Bitcoin is the increasing centralization of mining due to pools like GHash.

Crossing the 51%-threshold can give those who control the mining operation the ability to spend the same coins twice, reject competing miners' transactions and extort higher fees from people with large holdings.

Appetite for the digital currency remained weak after the U.S. announced plans last week to auction nearly 30,000 bitcoin seized from the infamous online black market Silk Road.

The U.S. Marshals Service said on June 12 that it plans to auction approximately 30,000 Bitcoins, valued at nearly $17.3 million, that were seized as part of the Federal Bureau of Investigation's crackdown on the Silk Road online marketplace last year.

The auction, which is expected to take place on June 27, will be sold in nine blocks of 3,000 Bitcoins and one of 2,657 coins.

Bitcoin prices rallied to $683 on June 2 amid speculation the digital currency will become more mainstream. U.S. satellite service provider DISH Network and online travel website Expedia both stated that they will start accepting Bitcoin later this year.

Bitcoin is digital cash and is not backed by a government or central bank to regulate or issue it. It can be used to purchase goods and services from stores and online retailers.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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