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Gold December 21, 2020 09:20:10 PM

Gold Unlikely to be Impacted by Bitcoin’s Rising Demand

Paul Ploumis
ScrapMonster Author
However, bitcoin’s rising popularity will not pose any existential threat to gold’s status as the currency of last report.

Gold Unlikely to be Impacted by Bitcoin’s Rising Demand

SEATTLE (Scrap Monster): The research report published by Goldman Sachs Group Inc. highlights the prospects of gold and bitcoin coexisting, even amidst the rising popularity of the world’s largest digital currency. Although bitcoin has gained immense popularity during recent times, gold’s safe-haven demand for investment purpose is unlikely to witness serious threat, said the bank in a note.

According to Goldman Sachs, the recent underperformance of the yellow metal as against real rates and dollar has raised concerns that bitcoin is replacing gold as the inflation hedge of choice. The bank notes that there has been a substitution. However, bitcoin’s rising popularity will not pose any existential threat to gold’s status as the currency of last report.

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Meantime, JP Morgan Chase & Co. had recently cautioned that the rally of cryptocurrencies will be at the expense of gold. Incidentally, bitcoin extended its stellar rally this month, surpassing the level of $23,000 per token last week. Bitcoin has recorded nearly three-fold jump in value since the beginning of the current year, whereas gold prices have risen by almost 25% so far this year.

Of late, bitcoin has seen huge surge in speculative retail investment, although transparency issued have averted institutional investment.

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