WASHINGTON.-The bitcoin cryptocurrency has starred throughout this week in an astonishing rise to its peak in the last year, around $ 10,900, and some analysts are beginning to predict that in this context of economic recession it has potential to become a safe asset with similar characteristics to gold, but in digital format.
Still far from its all-time high, close to $ 20,000, the cryptocurrency has fluctuated virulently since its inception and has undergone very rapid advances that preceded significant falls, especially after the puncture of what some experts called a “bubble” to end of 2018.
In the autumn of 2017, the price of bitcoin began to rise, exceeded $ 5,000 and quickly doubled in November to 10,000, one month later, close to $ 20,000.
However, weeks later, the price of bitcoin quickly fell below $ 7,000 in April 2018 and below 3,500 in November of the same year.
“Bitcoin is reversing its downtrend going back to the peak of 2017. For long-term investors, it is the kind of moves they will like to see,” Oppenheimer chief technical analyst Ari Wald told CNBC. Recommend this product for investors who do not want to enter the gold market because it is too bullish, after setting record highs this week.
Bitcoin’s rush to $ 11,000 coincides with the blazing rise in gold amid a flurry of investors seeking alternative assets to cash and the stock market, weighed down by the COVID-19 pandemic and the economic recession caused by the virus, adding to geopolitical tensions between China and the United States, low yields on treasury bonds and the weakness of the dollar.
“Bitcoin is currently achieving a reputation as a form of digital gold. Until now, gold has been known as the best safe haven asset, but bitcoin, which shares its key characteristics of being a store of value and scarcity, could potentially eliminate the gold of its long-term position in the future as the world becomes increasingly technology-driven, “predicted founder of the Vere Group financial firm, Nigel Green, in a note picked up by Marketwatch.
In an analysis note, AvaTrade analyst Naeem Aslam pointed out that if bitcoin overcomes this bullish phase “nothing can match it as a totally different type of beast,” he noted, while also saying that the next step of the cryptocurrency to demonstrate their resistance is to overcome the barrier of 15 thousand dollars.
However, other analysts such as Gradient Investments President Michael Binger continue to prefer the metal over the digital currency at this time, mainly due to the weakness of the dollar, interest rates and the prospect of rising inflation.
Binger admits that bitcoin is experiencing a “momentum” but affirms that it is still “not a valid currency” and that it prefers to continue recommending gold.
So far this year, Bitcoin has appreciated 53% while gold has advanced 28%.