The value of one bitcoin has surpassed $10,000, for the first time ever.

Over the last week, it increased by a third - more than $2,000. On 1 January 2017, one bitcoin was worth just $998. Naturally, the numbers have caused analysts to warn of a bubble.

This chart shows the cryptocurrency's dramatic price rise since the start of the year.

Bitcoin's value has increased ten fold during 2017, to more than $10,000
Bitcoin's value has increased ten fold during 2017, to more than $10,000
Image: CoinMarketCap

The cause of the surge is not clear. Exchange operator CME Group began trading bitcoin futures in November, which signalled increasing faith in the cryptocurrency. The cancellation of a contested upgrade to bitcoin’s transaction format may also have reassured investors.

Had you invested $100 in 2010, when bitcoin peaked at $0.39, you would have $2.8 million worth of bitcoin now.

What is bitcoin?

Bitcoin is a cryptocurrency, a digital currency which runs on a decentralized ledger called blockchain. It was launched in 2009 and designed to have a fixed supply of 21 million coins. These coins are acquired by mining, which involves using powerful, specialised computers to solve mathematical problems embedded in the blockchain. Certain solutions release bitcoin. Approximately 17 million bitcoin have been mined so far, currently worth more than $182 billion.