Can Bitcoin Replace Gold As An Investment Option?
Bitcoin has exhibited that it can be deployed to hedge against the risk while Gold’s recent growing nature presented the safe haven for investments. It stands out as the most trustworthy asset for parking the considerable sum of money, but Bitcoin is also gaining popularity in recent years.
Gold Is Not the “Completely Preferred” Choice Over BitcoinGold prices have hiked around $1600 after the rapid growth of last year. Though the stock markets boomed along with increasing geopolitical and market tensions, the investment in assets boosted up. This fact shows that risk-averse assets hold a significant position amidst of go economic tensions.
Gold is considered as the safe haven for parking the money in the least risky way which has the traditional inverse relation with volatile and dangerous assets. But for Bitcoin, the contradictory relationship is still not established as the coin has portrayed the positive trends even during the period of instability. On the contrary, cryptocurrencies also experienced sudden price down, which may support the fact that bitcoin is less reliable in comparison to Gold.
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
Investment Distribution Among AssetsAs per the analysts of the crypto market, investors must take advantage of the uptrend of cryptocurrency by parking a small part of an investment. Also, a significant portion of money must be invested in the traditional method of saving, i.e. in Gold which has the potential to safeguard the investors even during the extreme financial crisis.
Gold has the upper hand due to its high liquidity with multiple investment tools all across the world. The popularity of this commodity took off significantly when the Exchange Trade Funds (ETF) were introduced. Though ETF can divert the investment, However Bitcoin’s ETF is presumably tricky due to its continuous rejections from the US Securities and Exchange Commission.
Gold gained around 15% last year while 7% in the previous six months. Same time, BTC fluctuated but finally held the gains of more than 100% for the past 12 months.
Thus, investment choices totally depend on the needs of customers. If they are risk-takers, they can invest in bitcoins and expect significant benefits, but if the investors need a safe option to hold its resources, he must invest in Gold. Regardless of the situation, Gold is still the first choice for investment, but every day is growing exchanges hold the opportunity to stand with the commodity.
About The Author
Tarulika JainAn engineering graduate, focussing on latest trends of cryptocurrency. As an economic enthusiast, she likes to read about the changing economies of world.
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