By BLOOMBERG

HONG KONG • Cryptocurrency traders may not know what caused the abrupt surge in bitcoin on Tuesday, but they’re going along for the ride anyway.

The biggest virtual currency climbed to a fresh 2019 high yesterday, building on a spike that many market participants struggled to explain. Bitcoin increased as much as 5.9% to US$5,087.54 (RM20,757), according to Bloomberg composite pricing. Rival coins including bitcoin cash and ether also advanced. It later retreated back below US$5,000.

With the Bloomberg Galaxy Crypto Index now up more than 70% from the depths of last year’s crash, the debate over whether virtual currency prices have bottomed is heating up. Crypto diehards see Tuesday’s surge as confirmation that a new bull market has begun, while bears argue that entrenched scepticism among regulators, institutional investors and consumers will make any rally temporary.

This week’s price action has been encouraging no matter how it pans out over the long term, according to Timothy Tam, co-founder and CEO of CoinFi, a cryptocurrency research firm in Hong Kong.

“We’re testing new highs today,” Tam said. “So, I think this is quite positive for the market. We haven’t seen a move like this in a long time.”

Separately, Liquid Group Inc, a Tokyo-based crypto-currency trading platform, put out a press release yesterday that it had raised venture funds at a valuation in excess of US$1 billion, making it one of the rare so-called unicorns in Japan.

The start-up has secured funding from investors including venture fund IDG Capital and crypto mining giant Bitmain Technologies Ltd, it said in the statement. — Bloomberg