Bitcoin continues record price run as Ethereum nears US$400

Bitcoin's price has surged to a new record-breaking high of US$4,890. Photo / Getty Images

Bitcoin's price has surged to a new record-breaking high of US$4,890 (NZ$6,834), as the price of rival currency ethereum climbed up to just below $400.

The volatile cryptocurrency's record-breaking run has continued, with its value soaring above $4,700 for the first time on August 29.

Bitcoin's price has fluctuated to a previous high of US$,4,522 (NZ$6,320) for much of August and even slumped back to below US$4,000 (NZ$5590) on August 22.

But what next?

A Goldman Sachs investment banker predicted the price of bitcoin would continue to rise in a recent note to clients.

"Whether or not you believe in the merit of investing in cryptocurrencies, real dollars are at work here and warrant watching," the report said.

However, Sheba Jafari, a technical strategist at Goldman Sachs, warned the bubble could burst and the price could eventually fall to below US$3,000 (NZ$4193).

But Aaron Lasher, co-founder of Breadwallet, is more optimistic - he predicts the value of bitcoin will keep on rising over the next five years.

"Are cryptos in a bubble? Yes, absolutely," he told MarketWatch.

"Is that a bad thing? Not necessarily.

"The long-term trend is up, however, so past bubbles look less impressive in the rearview mirror.

"Do I know how high this bubble will go? Will I be selling any bitcoin before, during, or after the bubble? No."

Meanwhile, the price of ethereum, the rising star of the cryptocurrency world, has risen to a high of US$394.32 (NZ$551.10).

The price rise of bitcoin, litecoin and ethereum puts the overall value of the cryptocurrency market at record US$170 billion (NZ$237b), coindesk reports.

They add the price of bitcoin is now up more than 350 per cent this year.

Thinking of investing in bitcoin?

The Telegraph's Technology Editor, James Titcomb, warns: "While the party may continue for a while, it's just as likely to end spectacularly."