Bitcoin's meteoric rise took a hit overnight as the digital currency erased, then mostly recovered, about $200 in 12 hours.
The swing highlights how volatile the cryptocurrency can still be, even as some investors believe bitcoin can one day be a viable alternative to safety assets such as gold. A similarly rapid move of $200 in futures contracts for the precious metal would have caught the attention of global investors: Gold has traded in a range of about $150 so far this year.
Bitcoin was trading near $2,250 Tuesday as of 1:26 p.m. ET, according to CoinDesk. The digital currency earlier hit a fresh record of $2,291.09, following a drop below $2,100 overnight, the site showed.
Chris Burniske, blockchain products lead at ARK Investment Management, pointed out in a January
"While bitcoin's volatility has been decreasing over time, it should still be recognized and treated as a volatile asset," he told CNBC.
Bitcoin overnight performance
On Monday, bitcoin briefly surged more than 11 percent to a prior record of $2,289.21, up about 30 percent in the last week alone. The digital currency gained momentum as a major digital currency conference kicked off Monday in New
In less than a decade of existence, bitcoin has often swung dramatically. The digital currency fell more than 10 percent in January when Chinese authorities began investigating bitcoin exchanges and dropped more than 20 percent in March when the U.S. Securities and Exchange Commission rejected the application for what would have been the first U.S.-traded bitcoin exchange-traded fund.
News that the SEC is reviewing that decision and the Japanese government's official recognition of bitcoin as a legal form of payment have contributed to the cryptocurrency's run higher of the last several weeks.