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Bitcoin sights a new and big record to catch up with gold.
Not only has Bitcoin outperformed every other major currency, stock index and commodity on the market to put it within reach of its record all-time high set in 2013, but it is also aiming to break the price per ounce of gold set at $1134.
The prices to beat for the digital currency to reach its Nov. 30, 2013, all-time high tag of $1132.29 are in the $900-range, which the market shows it has already stepped into.
Market figures also show that Bitcoin has overtaken the end of day commodity futures price quotes of $893 for platinum on Dec. 23.
Now, with the rising U.S. interest rate expected to continue to drag gold prices as the Federal Reserve seeks to further normalize monetary policy in 2017, gold seems the next target to conquer.
Going by the current rate, a $240 addition to the value of one Bitcoin will bring it to par with the price of an ounce of gold.
Though such a significant record for Bitcoin could generate wider media attention, it is unlikely that the digital currency will overtake gold anytime soon.
According to Bloomberg, the gold premium has been at a three-year low with a note that since the election, more investors disposed of gold in comparison to Bitcoin.
Director of Research at Wedbush Securities, Gil Luria, told Bloomberg that the advantage of Bitcoin is that it is an asset that is uncorrelated with other assets such as real estates, equities and sometimes fixed assets.
“That’s an advantage that gold used to have but Bitcoin is now far more fluid. You can feel a closer ownership of that asset and that’s working. It’s not a safe haven and that your principle is insecure but there is a huge advantage to owning an asset that is not correlated to everything else that you have in the portfolio.”
Luria maintains that although Bitcoin trades like commodities such as gold, oil or copper and is not a completely safe investment, it has tremendous upsides and may rise in price if it gains mainstream acceptance and is used for everyday means.
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