Gold and Silver Are Soaring: Can Bitcoin Keep Up?
Gold and silver, the classical assets for securities, are heading for record highs this year. Major forces in the upward rush to the forefront are changing geopolitics and the possibility of shifts in Federal Reserve interest rates.
With the gold and silver prices accelerating, bitcoin, the "digital gold," has continued to trade quietly and steadily.
The uncertainty is whether Bitcoin will jump on the rally. Crypto Accountants discuss this in detail.
Gold Fears Geopolitics!
Recently, gold has risen above the price of $2,450 an ounce. This move was driven by the still-existing fear in Iran and the speculation of a dovish Fed. Any time there is geopolitical instability, investors tend to rush to assets that are safe havens.
It is also deemed very important for the store of value in the midst of uncertainty. Also, the Fed's low interest rate undermines the US dollar, and gold increases its attractiveness.
This year, central banks have also joined the party as significant buyers of gold, further driving up the price.
Breakout in Silver: More Gains Ahead?
Silver is also enjoying a spectacular year, having recently reached more than $30 per ounce. These are the levels last seen 11 years ago. Analysts say the price could rise another 50%.
Well, one reason for the potential rise of silver is that it's both a safe-haven asset and an industrial metal. It's also used in things like solar energy and electronics, which are boosting demand.
Can Bitcoin Join the Rally?
Up went gold and silver prices, thereby affecting another question: what about the cost of Bitcoin?
Now, Bitcoin itself has several favorable developments. The crypto has reached legitimacy on Wall Street, where it trades as futures contracts. The legitimacy attracts more institutional investors, which will definitely catapult the price.
But Bitcoin has its challenges. The asset cannot provide a physical presence, unlike the chances of what gold can provide.
Others think Bitcoin has now entered a period of consolidation and will see a price range of $55,000 to $75,000 over the next month.
Read more: What is Bitcoin Halving?
Market Cap and Price Targets: Bitcoin's Path Forward
Closing the Gap
For Bitcoin to be worth as much as all the silver in the world, its price would need to go over $93,000.
Bitcoin enthusiasts point to a marked tendency for the cryptocurrency to double in value once it has achieved a level of covering past peaks. It is mainly in the aftermath of events called halving, which is a built-in decrease in the size of the portion of the Bitcoin reward given to the miners.
The Bottom Line: A Tale of Two Markets
Different Markets, Different Drivers
Gold and silver are both up well on historical drivers that include increased geopolitical tensions and a possible bottom in the US dollar.
At the same time, Bitcoin is up in an established yet, some say, more battle-tested market scenario.
It is in its favour on the regulatory front, and developments continue to support it. However, the theoretical debate points to its value and price consolidation. These are equally troubling for most of them.
The question is, can Bitcoin maintain this momentum that's happening in the precious metals over the balance of this year?
Don’t fear the crypto ups and downs. Just talk to the Crypto Accountants to keep your taxes in line.
Disclaimer: Gold and silver prices are volatile and susceptible to change according to market rules. Please check the updated prices before making any decision.