See More

Bitcoin Is Following the Gold Route in the Digital Era

2 mins
Updated by Max Moeller
Join our Trading Community on Telegram
Bitcoin is to the U.S. dollar what the U.S. dollar is to unstable fiat currencies: a way to safeguard one’s wealth from sudden devaluation in the long-term.
At least, there are glimpses of that as trade wars, tariffs, political unrest, and government intervention shake up the global economy. As a result, over the past two months, analysts have highlighted an increase in correlation between BTC/USD and USD/CNY prices. bitcoin gold

Correlation Does Not Equal Causation

With the unleashed trade war between the U.S. and China, the alleged currency manipulation by the Chinese Central Bank and increased uncertainty in capital markets, investors have started to flee their capital in safe-haven assets. The clash between the world’s largest economies is weighing on stock markets. However, gold and digital assets are on the rise. Even though correlation does not equal causation, and there isn’t enough data to make an accurate claim, it’s difficult to ignore the coincidence that Bitcoin rose sharply in May and June at the start of the U.S. and China trade conflict.

Is Bitcoin a Safe-Haven Asset?

Some analysts believe that Bitcoin can be used as a safe-haven store of value in the same way as gold. Bitcoin is mimicking a safe-haven asset because its correlation with other assets that are more price-sensitive to geopolitical news has diminished. While this is far from a full confirmation, there may be something in common between Beijing’s yuan moves – one dollar is now worth more than 7 CNY – and the rise in BTC/USD. On the other side of the world, Argentina is trying to save its currency, the Argentine Peso (ARS), by introducing capital controls for the acquisition of foreign currencies. Bitcoin proponents view this as confirmation that fiat currencies will slowly falter as intervention mechanisms will only fuel capital flight into non-sovereign assets. Is Bitcoin showing strong signs as a potential digital gold following recent global events? Share your opinion with us in the comments! Buy and trade cryptocurrencies with a 100x multiplier on our partner exchange, StormGain.
Top crypto platforms in the US | March 2024
Coinbase Coinbase Explore →
AlgosOne AlgosOne Explore →
Chain GPT Chain GPT Explore →
iTrustCapital iTrustCapital Explore →

Trusted

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Christian_userpic_basic.jpg
Christian Gundiuc
After finishing his studies in International Business Administration at the Frankfurt School of Finance & Management, Christian started working at a real estate development company. Upon discovering Bitcoin and the cryptocurrency space, he switched his focus to learn, analyze and write about all things digital.
READ FULL BIO
Sponsored
Sponsored