Bitcoin will always be correlated to the *speculative* value of gold

[tinopener]

It has become obvious that the latest bitcoin bump has come from institutional investors using bitcoin as a hedge instead of gold and bonds and probably retail property.

Could bitcoin plateau at the same value and market capitalization of gold, if you subtract the jewelry and electronics value from gold?

[hatshepsut93]

Bitcoin has a potential to be a currency, a method of exchange, so if its adoption would start rapidly increasing, it could grow while gold does not.

And I don't think there's any reason to expect that Bitcoin will plateau at the same marketcap as gold - they are not the same thing. Even if you compare them as store of value, gold is inflationary, because more can be discovered, and its hard to use and most of the time involves custodians. Bitcoin is easy to store and transfer and available to all people.

[tinopener]

Bitcoin has a potential to be a currency, a method of exchange, so if its adoption would start rapidly increasing, it could grow while gold does not.

And I don't think there's any reason to expect that Bitcoin will plateau at the same marketcap as gold - they are not the same thing. Even if you compare them as store of value, gold is inflationary, because more can be discovered, and its hard to use and most of the time involves custodians. Bitcoin is easy to store and transfer and available to all people.

Thanks hats.

They are indeed not the same thing, and most people who will now invest in bitcoin from now on will know that, but will probably be prepared to hold both.

I personally think the biggest threat to crypto in the short to medium term will come from the environmental damage public relations....

... but it could also be the saviour if crypto can become a gratuitous reason to prove green energy creation.

I personally hold both bitcoin and gold (as well as other traditional assets) but will now start watching the gold price a bit more, and probably the first time the gold / silver ratio if bitcoin creates extra knock on volatility there.

[Tytanowy Janusz]

The price is the result of investors' decisions. So price will fallow gold as long as "bitcoin as cyber gold"  paradigm is with us. I see current trends like:
1- bitcoin is threaded as digital gold by 20-30% of investors
2- bitcoin is threaded as gambling by 5-10% investors
3- bitcoin is threaded as high risk pump and dump investment by 60% (lambo guys)

And price will be result of their decisions. Thats why when big news hit market (like covid vaccine) bitcoin reacts like that:



First pump like the SP500 (short-term fast-acting speculators treated it like the SP500) and then, after 15 mins (3 candles 5 mins), it was dumped chasing gold.

[tinopener]

The price is the result of investors' decisions. So price will fallow gold as long as "bitcoin as cyber gold" is with us. Currently i see it current trends like:
1- bitcoin is threaded as digital gold by 20-30% of investors
2- bitcoin is threaded as gambling by 5-10% investors
3- bitcoin is threaded as high risk pump and dump investment by 60% (lambo guys)

And price will be result of their decisions. Thats why when big news hit market (like covid vaccine) bitcoin reacts like that.

First pump like the SP500 (short-term fast-acting speculators treated it like the SP500) and then, after 15 mins (3 candles 5 mins), it was dumped chasing gold.

Wow, thanks Tytanowy. Good objective insight.

Have you bought any crypto related assets?

I bought some Invesco Elwood blockchain this month, which has companies like Microstrategy and Square, as well as cpu companies.

I'm also thinking about Ruffer investment company (as a bond proxy) as they have bought into bitcoin this month.

[Sterbens]

Could bitcoin plateau at the same value and market capitalization of gold, if you subtract the jewelry and electronics value from gold?

not
and of course cannot match the market capitalization of gold. because of the nature of their use will be the difference between bitcoin and gold. although both are assets, bitcoin is not gold. bitcoin is a reflection of traditional money growing into a digital asset that goes beyond super instant transactions. where its rarity will make the price more than gold. only one can convert bitcoin and the price won't even have any value, that is, the entire world internet network is totally dead.
maybe gold is the solution.
But will it happen in such a short amount of time? not really.

In essence, gold is still gold at its current price, and bitcoin is still bitcoin with an extraordinary value today.