Real Vision CEO Raoul Pal sees it as a positive sign for Bitcoin that the crypto currency is gaining ground against gold.
Raoul Pal, crypto expert and CEO of Real Vision, points out that gold is currently losing ground to Bitcoin (BTC). If the market-leading crypto currency can increasingly gain against the precious metal, this would also increase its persuasive power as a store of value.
Last month, Bitcoin gained 30.36% in the currency pair with the US dollar, an increase from $10,316 to $13,217. Over the same period, gold only gained 2.25%, up from $1,863 to $1,903.
Gold is losing ground compared to Bitcoin. Source: Raoul Pal, Bloomberg
Why is Bitcoin currently so strong?
While Bitcoin was able to make a strong climb in the last two weeks, gold and the stock market have also slowly recovered.
For the flight of the crypto currency since beginning of October thereby the interaction of three factors was responsible substantially.
Firstly, PayPal’s market entry has boosted sentiment in the crypto market; secondly, there is increasing interest from institutional investors, as evidenced by the investments of Square, MicroStrategy and Stone Ridge; and thirdly, the technical indicators in Bitcoin’s long-term price chart are positive.
Especially after Bitcoin was able to break the $12,000 mark, trading volumes have shot up significantly and the crypto currency has been able to leave many financial products behind. In this respect Pal:
„As expected, gold loses to Bitcoin. An:@michael_saylor Remember that! Next, I expect Bitcoin to be able to depend on the US dollar and the stock market…. Let’s wait and see. #Bitcoin
As Cointelegraph had reported, the jump over the $12,000 mark for Bitcoin was also a breakout in the weekly chart. Looking at the weekly and monthly charts in logarithmic representation, some crypto experts therefore soon see a new record high on the horizon.
The strong technical indicators as well as the increasing strength against gold and the stock market could further boost the current climb.
In the short term, however, one analyst still sees Bitcoin in an identity crisis, possibly even to the advantage of the crypto currency.
To this end, the crypto-trader Cantering Clark explains that gold usually comes under pressure when the US dollar rises, while Bitcoin is not yet clear whether this is an asset for risk avoidance or for risk increase (with the chance of profit increase). This uncertainty in turn reduces the correlation between the crypto currency and the US dollar. So writes Clark:
„The US dollar is gold’s counterpart, because if the US dollar index goes up, gold automatically comes under pressure. Bitcoin has the advantage of the identity crisis, because some see it as a store of value, while others see it as a multiplier for the stock market“.
Praise from investment guru Jones is the icing on the cake
While the market-leading Kryptowährung has thus opposite gold and the stock market the nose in front, also still another prominent investor speaks again for Bitcoin.
Investment guru Paul Tudor Jones, which had already disclosed its investment in Bitcoin in May, confirmed last its positive attitude opposite the crypto currency.
An analyst of the crypto stock exchange Deribit quotes Tudor Jones to that effect with the words
„I have never seen a store of value with so much intellectual capital behind it. […] If you take a short position in the bond market as a hedge, you are basically betting on the fallibility of humanity and not on its success.