But the cryptocurrency is pitched against Gold, a giant worth a couple of trillions of dollars, more than individual stocks. Analysts have found that there are similarities between bitcoin and gold economically.
Firstly, they both behave as safe-haven assets against geopolitical and macroeconomic risks. Secondly, both are speculative investments. Thirdly, both tend to portray themselves as scarce assets against inflation worries.
Nevertheless, many gold traders have accused bitcoin of being unworthy of any real credibility, even though the cryptocurrency has grown 8,000 percent in its 11-year lifetime.
But the fast-spreading coronavirus pandemic is proving that Bitcoin is resilient and can cope even under these extreme circumstances. As the virus forces people into their homes to practice social distancing, it has kept businesses across all the leading sectors closed. The global economy is expected to shrink by 3.2 percent in 2020, according to the United Nations.
The demand for gold is rising as the world’s oldest safe-haven. Nevertheless, gold has turned out to be a heavy object for some, leaving many bitcoin enthusiasts to play “what if” with Gold bullishness.
Bitcoin Recovering faster
Bitcoin recovered faster and broader than any other traditional asset after the global market sell-off in March. Even Gold’s gains were meagre at 15 percent YTD in comparison.
It isn’t just the price, but the real world implications of Covid-19. Rather than moving physical gold which means physical risk and the risk of infection, Bitcoin can be transferred from one wallet to another.
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