Wednesday, January 17, 2018

Don't look now but in the first 17 days of January gold has provided better returns than bitcoin and most cryptocurrencies

There is no dispute... 2017 was the year of Bitcoin and cryptocurrencies. But like we have seen many times in all markets, what goes up tends to go down even faster when that particular market begins to implode.

The middle of December seemed to be a turning point for many asset classes as over the past 30 days we have seen a severe drop in the dollar of more than 230 bps, and the granddaddy of cryptocurrencies (Bitcoin) decline over 50% from its Dec. 17 all-time high of $20,000.  But within all of this, the one asset that has seemed to gain steam while other securities were failing was the price of gold.

And now 17 days into the new year an interesting statistic has emerged.  Gold is doing better than the majority of cryptocurrencies.

Tuesday has been a particularly disappointing day for bitcoin investors, as the digital currency has dropped almost 20% during the trading session. Kitco.com’s aggregated markets show bitcoin last traded at $11,400 a token. Bitcoin is down 42% from its record highs of above $19,000 seen just one month ago. 
By comparison, the gold market is one of the best performing assets at the start of the new year, holding near a four-month high. February gold futures settled Tuesday’s session at $1,337.10 an ounce, up 8% since its lows seen last month. - Kitco
Cryptocurrencies still have the potential to soar past gold in terms of price and return, but their volatility makes them very difficult for some investors to hold strong through their wild swings in price.  And as more governments begin to crack down and demand regulation over the cryptocurrency sector, gold should remain a viable tortoise on the road to the finish line while the 'rabbit' must deal with many more pitfalls and obstacles to go much higher.

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