TL; DR Breakdown
- Gold prices have decreased due to inflation
- Most fund managers, analysts, and investors agree that BTC is better than Gold
- There’s a general consensus that Bitcoin will dislodge Gold in the long run
While the crypto market may seem to be experiencing a bumpy moment, Bitcoin is gaining against Gold as the most preferred asset for the store of value. The downward price action in the crypto market may be a result of increasing fears by investors amid reports of looming lockdowns due to Coronavirus. It’s worth noting that the outbreak of the Coronavirus pandemic has wreaked havoc in various economic sectors across the world.
Gold is down
The fear has affected the Gold market as well, setting the asset back by 0.7% in the last week alone. This followed a statement by a Board Governor of the Federal Reserve, Christopher Waller, lending support for the Central Bank to continue with quantitative easing measures that have been known to cause inflation.
Just recently, Gold prices shot up to hit a 5-month high, something that technical analysts like Gary Wagner have attributed to the rise in inflation. Gary works with the Gold Forecast. According to him, Gold’s price is directly linked to the Dollar, and when the currency value decreases due to inflation, Gold’s price seems to increase.
Bitcoin as a superior store of value
A look at the market dynamics over the last few years suggests that fund managers are increasingly in favor of Bitcoin as opposed to Gold when settling on an asset for store of value. While issuing a report for this year’s third quarter, the CEO of Galaxy Digital, Mike Novogratz, noted that Gold has been overtaken by BTC as the asset offering a greater store of value. Mike went on to note that Bitcoin is now widely accepted, with over 200 million users across the world. That’s a huge achievement for an asset that has only been around for a decade.
Bitcoin will outrank Gold
The battle between Gold and Bitcoin has been heating up for years, and now some of the top and most respected market players are in the BTC camp. According to the founder of Skybridge Capital, Anthony Scaramucci, everyone who learns about BTC ends up putting money in it. Scaramucci is positive that Bitcoin will reach $500k in price in the near future. Paul Tudor Jones is another popular figure that has been pro-BTC.
At the time of this writing, Bitcoin trades at around $56,765, posting a 13.5% pullback over the last 7 days and a -3.9% on the daily. However, it appears that the price pullback has affected most of the other cryptos as well, making it a general market shift.