After falling as low as US$2,981 at the end last week following a crackdown by Chinese regulators, the cryptocurrency bulls have now returned and have taken the Bitcoin price almost 32% higher to US$3,929.
But according to one leading hedge fund manager, Bitcoin's days at these high prices may be numbered.
Ray Dalio, the head of Bridgewater Associates, told CNBC that he believes that Bitcoin is a bubble and being driven by speculation and greed.
While some believe that Bitcoin has the potential to be an alternative currency, Mr Dalio doesn't see things this way.
In order to be classed as a currency, he believes it needs to be able to be used to make transactions and store wealth. Dalio doesn't see Bitcoin as providing either of these qualities.
Instead, he believes traders are merely buying Bitcoin in the hope of selling it at a higher price.
Mr Dalio's sentiment is similar to that of Jamie Dimon from JP Morgan. Last week Mr Dimon labelled Bitcoin a fraud and compared it to the Tulip mania which swept through the Netherlands in the 1600s.
Is the Bitcoin bubble about to burst?
While Mr Dalio and Mr Dimon make valid points, I don't believe Bitcoin is going to crash just yet.
The cryptocurrency has recovered well from the initial sell-off following recent events in China. Clearly there is still an appetite for Bitcoin even when its future is in question.
Although I won't be investing in it any time soon and would recommend investors do the same, I wouldn't be at all surprised to see the bulls take it to a new all-time high in the near future.
