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Analyst flags quiet shift as Bitcoin and gold reverse roles
Key Points:
While gold has been hailed as a store of value for decades, Bitcoin (BTC) believers argue that the cryptocurrency is a similar asset, often dubbing it "gold 2.0."
Similar to gold, Bitcoin is scarce and has a limited supply of 21 million coins. Bitcoiners argue it offers a hedge against inflation and dollar debasement just like gold.
But traditionalists have dismissed Bitcoin's "gold 2.0" narrative, and they couldn't be dismissed because while Bitcoin fell more than 25% from Jan. 1 to Feb. 28 this year, gold rose more than 20% during the same period.
But the trend reversed after the war between the U.S.-Israel and Iran began on Feb. 28. Since then, gold's price has dropped more than 15% to $4,407.37 per ounce, but Bitcoin's price has risen around 10% to $69,350.73 at press time.
This is exactly what senior Bloomberg ETF analyst Eric Balchunas recently highlighted on a show.
Balchunas sheds light on gold and Bitcoin reversing roles
On March 23, he appeared on the "Bloomberg ETF IQ" show and said a lot of people were dumping on Bitcoin 2-3 months for not acting like a safe haven store of value, in contrast to gold.
Issued by State Street Investment Management, SPDR Gold Shares (NYSE: GLD) is a top exchange-traded fund (ETF) that tracks the price of one-tenth of a troy ounce of gold.
The fund is one of the largest gold holders in the world. But it saw an outflow of $2.20 billion last week (March 16-20).
Though ETFs linked to Bitcoin are much smaller in value, the total net inflow last week remained positive at $95 million.
On March 24, Balchunas wrote on X that Bitcoin ETFs have seen a total net inflow of $2.5 billion this month and could soon dig out of its "flow hole" this year. BlackRock's iShares Bitcoin Trust ETF (Nasdaq: IBIT) is already among the top 2% ETFs in YTD flows, he highlighted.
When gold fell 40% around 10 years ago, one-third of the investors retreated and this is normal, but Bitcoin flow is just "abnormal" amid the 40% drop in six months, Balchunas concluded.
This article has been published in thestreet.com via Yahoo News.
Analyst flags quiet shift as Bitcoin and gold reverse roles
Bitcoin advocates call it "gold 2.0" due to its scarcity feature.But gold traditionalists have rejected such claims.However, recent trends suggest a role reversal. While gold has been hailed as a store of value for decades, Bitcoin (BTC) believers argue even the cryptocurrency is one similar...
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