State Street Global Advisors: Reports Of Gold Investors Flocking To Cryptos Have Been Exaggerated
Reports Of Gold Investors Flocking To Cryptos Have Been Greatly Exaggerated
Bitcoin and gold share many similarities, including being used as a currency, transfer of wealth, store of value, and more – they also both can be “mined” for and boast relative scarcity as one of the reasons giving it such value. That scarcity is where the differences between the two assets begin to show. Bitcoin is hard capped at 21 million BTC, while there is potentially an endless supply of gold that can be tapped into.
Gold having a physical attribute over the crypto asset’s digital-based existence is both a pro and a con for the chemical element, making it ideal for jewelry and other flashy material items, but preventing it from easily being transferred or stored.
In the crypto industry, there had been reports that many investors are finding cryptos to be a better alternative to gold and are slowly buying into the trend. However, George Milling-Stanley, State Street Global Advisors’ head of Gold Strategy doesn’t think so.
“I’m not seeing any flood of money out of gold into cryptos, and if there were, I don’t think the cryptocurrencies would have lost 80% of their value last year. They all seem to have a question about cryptocurrencies because their investors, at whatever demographic, are asking them whether this is a good idea. Gold has managed to maintain its level rather than falling [because of] this general atmosphere of uncertainty that makes people look for safe havens. We haven’t seen the collapse in the stock market, that would obviously be helpful for gold prices. The yield curve is giving mixed signals, there seems to be confusion to whether it’s signaling recession or not.”
He has a point. Gold has proven to be a solid investment in times of volatility. But still, if there’s ever been an asset that can give the precious metal a real run for its value, it would be Bitcoin. The unique digital asset has the potential to become the global currency for the internet, and most crypto investors expect it to be eventually worth upwards of $100,000 to millions of dollars per BTC.