A cryptocurrency fan has become a billionaire after buying just £2,500 in Shiba Inu digital coins last August.

The price of Shiba Inu hit a record high this week after tripling since Sunday.

The coin has risen from £0.0000020 on Sunday to a record peak of £0.000065 yesterday, and is £0.000051 today, according to cryptocurrency website Coinbase. The cryptocurrency is now worth around £27.8billion in total.

The new billionaire bought the digital coins 40 times in the past 14 months, according to Coin Telegraph.

The mystery trader bought nine lots of Shiba Inu, or SHIB, in August 2020 - the month the currency was launched.

He or she is a billionaire from those purchases alone after the value of the cryptocurrency rocketed.

Shiba Inu is now the ninth-biggest cryptocurrency, but it started last year as a semi-joke.

Have you made a fortune from cryptocurrency - or lost it all? Message mirror.money.saving@mirror.co.uk

The cryptocurrency started as a humorous nod to the cute Shiba Inu dog breed, which in turn led to the 'Doge' internet meme.

This meme led to the creation of another jokey cryptocurrency, Dogecoin - and the Shiba Inu cryptocurrency is also a reaction to that.

The new cryptocurrency was launched just last August by a creator known only as Ryoshi - based in China.

Shiba Inu, on the left, is soaring in value - as is Dogecoin, on the right (
Image:
NurPhoto via Getty Images)

The Shiba Inu cryptocurrency has been boosted in the past by billionaire Tesla boss Elon Musk - who is also a crypto fan.

Earlier this month Musk tweeted a photo of his Shiba Inu puppy, which started the ball rolling with a rise in the price of the currency.

Much of the current rise in Shiba Inu is due to speculation it could soon be listed on trading platform Robinhood.

Where can I get Shiba Inu?

You can buy Shiba Inu on cryptocurrency trading platforms like eToro, Binance and Coinbase - though Binance is not available in the UK.

The Shiba Inu coin features the Japanese dog breed of the same name (
Image:
Getty Images)

What are the risks of investing in cryptocurrencies?

Investing in crypto is risky. Cryptocurrency is not regulated in the UK, unlike most other financial products.

The Financial Conduct Authority (FCA) watchdog does monitor crypto, but only to prevent money laundering or funding terrorism.

That means if you put money into anything to do with crypto and lose it you will probably never see it again.

Many other financial deals are regulated by the FCA, meaning your money is protected up to £85,000 if the company goes bust or your money is stolen somehow.

This is thanks to the Financial Services Compensation Scheme (FSCS), a fund financial firms pay in to.

You can check on the FCA or FSCS websites to see if a company you are interested in is regulated and safe to deal with.

What makes cryptocurrencies rise and fall?

Digital currencies can easily rise or fall by 3-4% in a normal day.

Traditional investors would look at this sort of daily rise with horror.

Investors used to major financial indices, like the FTSE 100, are accustomed to them moving by less than 1% a day. So what makes cryptocurrency so volatile?

The answer is: almost anything, from financial regulation to viral tweets.

In August, the price of Bitcoin, the biggest cryptocurrency, rose because of news that Google will allow cryptocurrency adverts.

Because Bitcoin is so dominant, what happens with its price tends to be mirrored by its smaller rivals.

Other common reasons for cryptocurrency prices rising are because of tweets from famous investors such as Elon Musk.

Earlier this year Musk put the word 'Bitcoin' in his Twitter biography and the price of the currency rose by 20%.

But the price of cryptocurrencies can fall just as easily as they rise.

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