Bitcoin investors have been abandoning crypto in favor of traditional commodities such as gold amid the prolonged market slump. This is what Jan Van Eck, the CEO of investment management firm VanEck Associates stated.
Van Eck said that this was a reversal of the trend that was seen in 2017 when the then-sizzling bitcoin pulled in demand from gold during the bullish crypto market. He said to CNBC that- “I do think that bitcoin pulled a little bit of demand away from gold too in 2017. We polled 4,000 bitcoin investors and their No. 1 investment for 2019 was actually found to be gold. Which means, gold lost to bitcoin [before], and now it’s happening the other way round.”
Tim Seymour, the founder of Seymour Asset Management, also agreed with Eck and said- “There is no question that bitcoin ended up sucking the life out of the gold market [in 2017]. Bitcoin has its limitations as a long-term investment since it is extremely volatile and is not a store of value. We have lost all liquidity in the underlying [commodity], but outside of the existential blockchain argument, it has been very difficult to argue [that bitcoin is indeed a] store of value. Gold is a store of value and no disputes in that.”
Jan Van Eck went on to say that he has decided to withdraw VanEck’s bitcoin ETF application last week after the 35-day US government shutdown. He thought it would be wiser to withdraw the application rather than being rejected.
Van Eck has plans of re-filing his bitcoin ETF application after the SEC resumes normal operational capacity.
On January 25, President Donald Trump signed a temporary spending bill which would reopen the government up to February 15. After this, if Trump and Congress still are unable to negotiate a solution for the much-discussed border wall funding, they could be another possible (though unlikely) government shutdown could occur.