Bitcoin value surpasses $1,000 for first time

Bitcoin’s value has surpassed $1,000 for the first time, MTGox announces.

MTGox is one of the virtual currency’s major exchanges.

Bitcoin’s value has been rising rapidly since a US Senate committee hearing earlier this month.

Confidence grew after the committee described virtual currencies as a “legitimate financial service”.

Bitcoin has become popular in part due to it being difficult to trace transactions.

The currency is often linked to illegal activity online.

Customers using the Silk Road – a website selling illegal drugs that was shut down last month – would pay for goods using Bitcoin.

Many worried the crackdown would cause the value to plummet, but instead growing confidence that regulators will not imminently seek to ban the currency has seen its price soar.

Enthusiasts say it is a highly efficient way of handling global money transfers.

“For Bitcoin to go from zero to $1,000 in just five years has been amazing to watch,” said Mike Hearn, a Bitcoin developer.

“It’s easy to forget that Bitcoin’s true value is not in an arbitrary exchange rate, but in its ability to enable new applications and services which aren’t possible with today’s payment networks.”