Bitcoin is good, but gold is still much better.Analysts Say Gold Outranks BTCThat’s the sentiment of most analysts, today. At the time of writing, bitcoin – the number one cryptocurrency by market cap – is not doing so hot. The asset has fallen by another 0 overnight as fears of the coronavirus continue to swell throughout the globe, and it doesn’t look like things are going to ease up anytime soon.There has been an idea meandering throughout the crypto space for some time that gold and bitcoin are on equal terms – that the cryptocurrency shares some of the same properties as the precious metal and that it’s capable of some of the same things. Well, most analysts say this isn’t quite the case. That gold has so much more power when it comes to retaining wealth and remaining strong during
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Bitcoin is good, but gold is still much better.
Analysts Say Gold Outranks BTC
That’s the sentiment of most analysts, today. At the time of writing, bitcoin – the number one cryptocurrency by market cap – is not doing so hot. The asset has fallen by another $400 overnight as fears of the coronavirus continue to swell throughout the globe, and it doesn’t look like things are going to ease up anytime soon.
There has been an idea meandering throughout the crypto space for some time that gold and bitcoin are on equal terms – that the cryptocurrency shares some of the same properties as the precious metal and that it’s capable of some of the same things. Well, most analysts say this isn’t quite the case. That gold has so much more power when it comes to retaining wealth and remaining strong during times of economic uncertainty.
Crypto and blockchain writer Steven Ehrlich explains:
Bitcoin has shown a degree of correlation with gold and other ‘safe haven’ assets in the past, but the narrative that bitcoin is a perfect substitute for gold is not as prevalent as some may believe. Additionally, while bitcoin has some characteristics that compare favorably with gold, for many people with low risk tolerances who seek to protect their wealth above all else it remains far too volatile.
Crypto market advisor Dave Carlson agrees. He says that bitcoin, while strong, is still a very young asset, and will require a lot more time to heave itself up through the financial ranks. He also says it’s not as necessary or as appreciated in all areas, and thus its stability tends to range depending on where it is used.
He cautions:
I recommend taking a multi-year view on bitcoin speculation. Once it has matured – think ten more years at least – the price should be much more stable, as the rate of new coin generation will be much slower… If you are in Venezuela right now, bitcoin is absolutely the new gold.
Cash Still Above All?
At the end of the day, people like Michael van de Poppe – CEO of BonSanca – explain that cash is still king, and that in times of trouble, having a lot of cash on hand is going to be the ultimate saving grace. He says:
If you go back in history, gold dropped heavily in 2000 and 2008 together with the stock markets. Then, it outperformed the equity markets in the years after until equities made a new all-time high once the fears of the crisis went away. Bitcoin is dropping due to heavy economic instabilities. People want cash on hand in case of more trouble.
Overall, bitcoin has shed roughly $2,000 from its 2020 high of around $10,400 and has lost more than 40 percent of its overall gains this year.