Bitcoin bubble or just the beginning? Or both? Those are the questions being asked on Wall Street to Main Street after the digital currency breached $US5,000 for the first time, pushing this year's gains to more than fivefold.

As recently as December, bitcoin was trading at less than $US1,000. Since then, it has dodged everything from tightening regulations, feuding factions splitting its underlying blockchain and warnings from the likes of JPMorgan Chase chief executive Jamie Dimon of fraud and an eventual price collapse.

The latest leg higher is being driven in part by increasing institutional interest, with everyone from Goldman Sachs's Lloyd Blankfein to Dimon saying they're now open to ways to get involved. The change of heart comes amid growing optimism about the blockchain technology.

"This record is an exciting milestone and sign of market confidence in the outlook for bitcoin and the underlying technology," said Iqbal Gandham, a managing director at eToro. "We expect many more milestones like this to come."