Bitcoin rose above $50,000 on Tuesday to a new record high, building on a rally fuelled by signs that the world’s biggest cryptocurrency is gaining acceptance amongst mainstream investors.

Bitcoin hit a new high of $50,602, and was last up five per cent at $50,300. It has risen around 72pc so far this year, with most of the gains coming after electric carmaker Tesla said it had bought $1.5 billion in bitcoin.

It also said it would accept the currency as payment.

Read: Elon Musk wants clean power but Tesla's carrying Bitcoin's dirty baggage

But Tesla was only the latest in a string of large investments that have vaulted bitcoin from the fringes of finance to company balance sheets and Wall Street dealing desks, as United States firms and traditional money managers have started to buy a lot of it.

Central bankers and regulators, particularly in China, are also starting to embrace issuing their own digital currencies for everyday use, in a major break from the conventional workings of global finance.

“Digital currencies, it seems clear to us, are going to be an increasing part of financial architecture very broadly and potentially portfolios moving forward,” Ben Powell, APAC chief investment strategist at BlackRock’s Investment Institute said on CNBC earlier this month.

“There isn’t just news in the US with the bitcoin situation, but in China we’ve got a rollout of China’s digital currency with so-called ‘red packets’.”

Just 12 years old, bitcoin has seen a meteoric rise since March 2020, when it stood at $5,000.