Bitcoin price: why the sudden surge in value?

Values in bitcoin and rival cryptocurrencies have surged over the weekend, triggering hopes of a change in fortunes for the ailing market.

Bitcoin prices leapt from $3,400 per coin to nearly $3,700 (£2,630 to £2,860) on Friday, with values remaining above $3,600 (£2,780) over the weekend, according to ranking website CoinMarketCap.

Rival coins also made considerable gains, with Ethereum jumping from $104 to $120 (£80 to £92) over the past three days, and Ripple breaking above the $0.30 (£0.23) threshold.

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Experts are uncertain as to what caused the sudden market turnaround, but The Independent reports that it may be down to an inflation of bitcoin’s hash rate - a measure of how much power the cryptocurrency consumes to “process transactions” and generate new coins.

The virtual currency’s hash rate reached its highest level since last November over the weekend, which means that there has been an increase in the amount of people joining the bitcoin network in a bid to unlock more coins - a process commonly referred to as mining.

The cryptocurrency market’s gains will be welcomed by investors, following months of declines.

But according to digital currency site NewsBTC, the virtual coin market is still in a “bearish” state. The site predicts that bitcoin will drop to around $3,500 (£2,710) over the coming days, before values level off.