The skyrocketing price of Bitcoin has spurred an uptick in cryptocurrency investment among Australians looking for a financial safe haven and hedge against inflation, analysts say.
Driven by investors seeking returns amid low interest rates and a weakening US dollar, cryptocurrency speculation has boomed since the start of the COVID-19 pandemic.
The value of Bitcoin has tripled since November, the start of its most recent rally, and lifted more than eightfold since March 2020. It now has a market capitalisation of more than $US1 trillion.
It comes after finder.com.au data this month showed a quarter of Australians either own or plan to own cryptocurrency by the end of 2021, primarily as a means by which to achieve capital growth.
Millennials were 11 times more likely than baby boomers to own or plan to own cryptocurrency in 2021, finder.com.au also found.
Cryptocurrency exchange BTC Markets chief executive Caroline Bowler said her platform had experienced a 40 per cent jump in onboarding rates from the first half of 2020 to the second half.
She said a variety of users participated on her exchange, from traders buying in and out of positions across the day to those holding cryptocurrency for the long term.
And while cryptocurrencies experienced large swings in value on a day-to-day basis, Ms Bowler believed such volatility would temper as larger investors gain exposure to the asset class.
That includes Elon Musk-led electric car maker Tesla, which earlier this month purchased $US1.5 billion in Bitcoin and announced it would soon begin accepting the cryptocurrency as payment for its products.
"We predicted at the start of January 2020 that (it) would be the year of mainstream adoption, where the shoe would suddenly drop," Ms Bowler told AAP.
"People are becoming increasingly comfortable and seeing cryptocurrencies and digital assets more broadly as a longer-term investment strategy, an asset they can grow for their future."
US investment bank JPMorgan last month said the value of Bitcoin could rise as high as $US146,000 if it becomes established as a safe haven asset to rival gold.
But the bank also argued the speed of Bitcoin's appreciation is unsustainable.
Curtin University finance lecturer Vincent Chang told AAP the rise in the value of Bitcoin was reminiscent of the late-1990s dot-com boom, with uninformed investors "following the herd" amid the promise of massive capital growth.
That boom ultimately resulted in a crash, and people losing their investments.
"The amount of transactions that warrant this value of Bitcoin is really scary," Dr Chang said.
"If (people) have disposable income, go for it, but you've got to let it go at the right time ... for people getting something for the long term, I'd suggest they be careful, know what they're getting into."
The value of Bitcoin sat just shy of $71,700 at 1320 (AEDT) on Saturday, according to BTC Markets.