Gold Proves To Be A Safe Haven Asset Amid Bitcoin Crash
June 21 2022 - 7:00PM
NEWSBTC
The advantages of holding bitcoin over gold have been publicized
and debated countless times. These two digital assets, one a
physical asset and the other referred to as the “digital gold”,
have both gone head-to-head when it comes to which one is the
better store of value. As the bitcoin crash raged on last week, the
discussion is once again being had about the merits of holding a
relatively stable asset such as gold compared to a volatile one
such as bitcoin. Gold Provides Cover Over the past week, the price
of bitcoin had declined more than 30%. This had led to a sea of red
in the market as the rest of the cryptocurrencies followed suit.
During this time, the year-to-date value of bitcoin had dumped
significantly. This put the digital asset which had been
outperforming its physical counterpart for quite a while behind it
once more. Related Reading | Over $250 Million In Liquidations
As Bitcoin Recovers Above $20,000 Despite the year-over-year
returns of gold being gown, it remained in the positive while that
of bitcoin has declined into the red. As of Tuesday, gold is up
0.6% year-to-date, putting it in the green territory. As for
bitcoin, the cryptocurrency is now down a whopping 55% on a
year-to-date basis. The volatility of bitcoin has been a
cause for concern for those in the traditional finance market.
However, it has also been one of the biggest pulls for those
invested in the asset. It had grown more than 50% last year to an
all-time high of $69,000 before declining over the next six months
to a low of $17,600. BTC price trading below $21,000 | Source:
BTCUSD on TradingView.com While the sell-offs have rocked bitcoin,
gold has not been as unfortunate. So when it comes to the argument
of which of these digital assets serves as the better inflation
hedge, gold has now come ahead of the cryptocurrency. Bitcoin Going
Down? Bitcoin’s recovery streak has been encouraging over the past
couple of days. After hitting a low in the $17,000 territory, the
recovery has been steady ever since, save a few dips here and
there. With this has come a recovery above the 5-day moving average
for the first time in the last week. Despite this, the selling
pressure has remained high and more sell-offs are rocking the
market. However, support is beginning to form above the $18,000.
Related Reading | Bitcoin Recovery Wades Off Celsius
Liquidation, But For How Long? There are also the implications of
the price of the digital asset falling below the previous cycle
high for the first time ever. It has given credence to the school
of thought that the digital asset has not reached its bear market
bottom. Coupled with the fact that bitcoin has previously fallen at
least 80% in all its previous markets, the bottom is likely to come
in at around $13,000. Additionally, the bottom is expected to
happen about 15 months after the previous halving which puts the
bottom at some time in the 4th quarter of 2022. Bitcoin is trading
at $21,313 at the time of this writing. It is up 1.93% in the last
24 hours with a market cap of $405.8 billion. Featured image from
Kinesis Money, chart from TradingView.com Follow Best Owie on
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