Experts Say Bitcoin Will Still Outperform Gold, Here’s Why

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As a seasoned crypto investor with a decade-long journey under my belt, I have witnessed the rollercoaster ride of this nascent industry, and I must admit, it has been quite the thrill! The recent market selloff has tested even the most resilient investors’ convictions, but it hasn’t shaken my belief in Bitcoin’s potential.

In simpler terms, despite the recent drop in cryptocurrency prices, supporters’ optimistic views on crypto have remained firm. One analyst even asserts that Bitcoin has a history of surpassing gold’s performance during times when there’s an increase in debt and overleveraging within the financial system.

Nevertheless, the recent decline in Bitcoin’s value has challenged, to a significant extent, the traditional notion that it serves as a digital equivalent of gold and is an essential asset for diversifying investment portfolios to guard against the unpredictability of the stock market.

Bitcoin to Outperform Gold, Hit $100K in 2024

Over the weekend, the leading digital currency dipped beneath the significant $63,000 threshold as part of a broader pullback in the crypto market, erasing approximately $200 billion from its overall market value.

The price of Bitcoin (BTC) reached a two-month peak of $66,500 last Friday, setting it up for a potentially stronger final quarter this year. However, escalating geopolitical conflicts, particularly in the Middle East, could pose challenges to risky assets such as cryptocurrencies in the near future.

In the podcast discussion, Natalie Brunell featured Lawrence Lepard, an Investment Manager at Equity Management Associates. Lepard shared his views on the global financial landscape, particularly regarding high debt and leverage levels. He suggested that the current financial system requires more expansion in leverage and money supply to stay functional. Remarkably, he anticipates that Bitcoin will gain significantly more from this trend compared to gold.

Leper similarly pointed out that the current situation resembles the period of 2019 and 2020, when Bitcoin’s value fluctuated between $5,000 and $10,000, while gold struggled to surpass the $1,365 mark.

Experts Say Bitcoin Will Still Outperform Gold, Here’s Why

As an analyst, I’d like to clarify that prior to the outbreak of COVID-19, there was a significant breakout in the price of gold. Remarkably, this was swiftly followed by a dramatic increase in the value of Bitcoin (BTC). Despite gold experiencing a substantial rise of approximately 50% to 70%, Bitcoin outperformed, surging an impressive 300%.

Based on this, Lepard promptly emphasized that the current year still had time left, and he maintained a positive outlook, predicting that the value of Bitcoin might surpass six digits by the close of the ongoing year.

Gold and Oil Prices Surge Amid Middle East Tensions

Gold prices experienced a 1.4% increase on Tuesday, reaching approximately $2,665 per ounce, just shy of a record high, as for crude oil, its prices surged by 7%, settling at $72 per barrel.

Market events coincided with airstrikes over Israel, during which their air defenses successfully thwarted most of the 180 missiles fired. This significant disruption contributed to a slowdown in the crypto market surge and a spike in gold prices.

Additionally, bonds and the U.S. dollar also saw benefits, highlighting a growing apprehension among investors, as global politics intensified.

Geopolitical Uncertainty Fuels Gold Rally

Regardless of circumstances, it’s clear that the most powerful cryptocurrency globally is facing some tough challenges. As suggested by market expert Jeroen Blokland, founder of the Blokland Smart Multi-Asset Fund, there seems to be a global trend shifting from Bitcoin towards Gold. This transition is evident in the BTG chart, which plays a significant role in the current price correction.

Experts Say Bitcoin Will Still Outperform Gold, Here’s Why

Blokland links the escalating conflict between Iran and Israel over the past month with Bitcoin’s price instability and examines how this could affect investor trust. As a result, some investors are looking to gold as a traditional safe haven during market turmoil due to its reputation for stability amid volatility.

On Tuesday, tensions escalated as it seemed that missiles were launched from Iran towards Israel, causing alarm from the White House. U.S. authorities suggested that Iran might be readying for an immediate ballistic missile strike, raising concerns of a potential broader conflict in the region. The White House emphasized its dedication to assisting Israel’s defense and warned of severe consequences if Iran were to launch a military attack against them.

In simpler terms, the mix of economic instability and international political upheaval might make investors choose conventional secure investments such as gold, despite Bitcoin being referred to as “digital gold.” This could add more weight to the declining trend of cryptocurrencies as worries about a global economic downturn intensify.

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2024-10-02 18:30