Bitcoin has shown that it can be used as a hedge against risk. Gold’s latest ascent has presented a scenario for safe-haven investments, and this trend may boost the case for owning $BTC.
Gold Prices Peaked at Seven-year High, Rapid Growth in Past Six Months
Gold has marked a seven-year high above $1,600, after growing rapidly in the past year. Despite the booming stock markets, geopolitical and market fears still boost the case for investment in gold. After a relative slump, gold is on the ascent again, showing that risk-averse assets still hold significant appeal.
Gold printed a 7-year high yesterday. Will bitcoin open an era of digital commodities trading desk in the years to come? pic.twitter.com/jJCvy363BL
— skew (@skewdotcom) February 21, 2020
Gold has a traditional inverse relationship with more risky assets. For BTC, this relationship is yet to be established. The coin has shown rising trends during periods of instability, but also sudden price drops which can make it a poorer store of value in comparison to gold.
For now, the consensus is that Bitcoin should be a small part of one’s portfolio, to make use of the upside. Gold, on the other hand, remains traditional, but even during a streak of gains, its upside potential is much more conservative.
Gold gained about 15% in the past year, and of those, 7% in just the past six months. During that time, BTC fluctuated, though still holding more than 100% gains for the past 12 months. Gold traded at $1,643.62 on the spot market. Bitcoin traded around $9,617.74, slightly above its current support level.
Gold’s advantage is in its high liquidity,