Bitcoin price spikes as investment giant BlackRock shows interest in cryptocurrency market

'We see cryptocurrencies potentially becoming more widely used in the future as the market matures,' the $6.3 trillion investment platform previously said

Bitcoin has shot up in price by almost $300 following news that investment firm BlackRock is looking to move into the cryptocurrency space.

The 4 per cent rise in value took the digital currency back above $6,600 – still well below its 2017 high, when it peaked at close to $20,000.

Other major cryptocurrencies also saw significant market movement,with ethereum, ripple, bitcoin cash and EOS all surging by between 4 and 9 per cent.

A report in Financial News London on Monday cited sources close to the matter in claiming BlackRock had set up a working group to investigate cryptocurrencies and their underlying blockchain technology.

The $6.3 trillion asset management company acknowledged an interest in blockchain but refused to comment on any specific venture.

A previous company report by BlackRock, published in February, revealed the firm was taking a cautious approach to both cryptocurrency and blockchain technology.

"We see cryptocurrencies potentially becoming more widely used in the future as the market matures," BlackRock's Global Weekly Commentary said.

"Yet for now we believe they should only be considered by those who can stomach potentially complete losses. Similarly, blockchain needs to overcome significant hurdles to reach its promising future."

The value of bitcoin surged after rumours that a major financial firm wants to take advantage of cryptocurrency (Getty Images/iStockphoto)

People within the cryptocuyrrency industry welcomed the latest news, claiming it would help boost the public perception of digital currencies like bitcoin.

"BlackRock entering the crypto market is great news for the industry and one which was to be expected. It was always a question of when not if," Iqbal Gandham, UK managing director of trading platform eToro, said in an emailed statement to The Independent.

"Cryptoassets are a growing asset class and one which investors are increasingly keen to explore. Combined with the emerging world of tokenised securities, we have the perfect storm to create a new generation of investors as well as change the concept of investing itself.

"Hopefully with the traditional incumbents now entering the crypto space, we will see the conversation move forward from the tired rhetoric of Ponzi schemes and illicit behaviour, to focus on the more constructive question: how can we leverage this asset class to bring the next generation into investing?”