Bitcoin or BTC is in another slide, as it has lost $50 in trading value so far this week. It is actually a continuation of a 13-month trend which saw BTC lose almost 83% since its peak value – more than $19,000 in 2017, in December.
Bitcoin is not the only cryptocurrency that slides nowadays
The crypto-market watchers recently stressed the significance of resistance levels in stemming the losses, with about $3,000 given as a floor recently. Now, Bitcoin is testing $3,400; the coin has not traded above $4,000 since the 9th of January.
However, Bitcoin is not the only crypto that slides these days, nor is its total loss the most spectacular one. XRP, which is the trading token of the Ripple Network, slipped from 40 cents on Christmas Eve to about 29 cents yesterday, and it is down 89% from its peak – the 3rd of January, 2018 – of $2.73.
On the other hand, Ethereum or ETH trades at $105, which is its lowest level in more than one month, and it has lost about 29% since peaking at $1359, also in January of last year. The three are the giants of the cryptocurrency market, and they hold a combined $99 billion of the $113 billion total market cap of the industry.
It is fair to say that if they are plummeting, then the crypto market is also falling. The big-league players now test their resistance, probing their lower limits, and feeling the floor. Regardless of the idiom you choose, it means that the bear market may be here to stay forever.
So, if cryptocurrency investors get their money out of the crypto-coins, where are they putting it, and why is that so? The CEO of Van Eck Associates, named Jan van Eck, believes that he knows the answer. He said that they just polled 4,000 Bitcoin investors and their number one investment for this year is gold. So, gold lost to Bitcoin in 2017, but now it goes in the opposite direction.
Investments turn to gold
When Bitcoin peaked at the end of that same year, the gold has been trading at $1,256. The charting patterns of the gold are different from the ones of cryptocurrencies and the precious gold bottomed out this last August at $1,174.
According to the price of nowadays of $1,307, the gold is higher than it was in December 2017, and it is 11% higher than in August. Shortly said, the gold is up while the crypto is down.
This move to gold makes a good sense after all. Gold was always money, the medium of exchange and the store of value which people trust in. Its combination of portability, rarity, as well as durability makes it trustworthy in that role.
However, in the last quarter of 2017, crypto took off. We may all remember how it quickly rose to dizzying heights.
Crypto drops and investors pull their money out of it. It is in a prolonged bear market. The gold gains and is always reliable money – it looks like crypto investors have gotten a good lesson in recent months about the significance of having such a store of value.
The real needs of traders and investors
All of that is bringing up the question: How long before crypto investors see the obvious and begin trading gold on blockchain as a stablecoin? Bring the transaction speed and security of the blockchain and utilize it to trade gold, putting something substantial behind the crypto-coins. Is that actually a future?
There is many gold-pegged blockchain crypto-coin offering which already available. The DGX or Digix Gold token is a typical example of the score or so of ‘gold coins' coming into the markets. This token is based on the technology of ETH. Pegged at a rate of 1 DGX to 1 gram of gold, and it is backed by real gold, kept in a secure location. DGX has been launched in September of last year, and it is trading at $42.85. Each of the tokens represents ownership of one gram of the stored gold and is redeemed in metal.
The co-founder of Digix thinks that a gold-pegged coin is going to bring much-needed stability to the volatile crypto markets. The people appreciate hedging in economic uncertainty. Crypto winter is probably going to last throughout this year, and the tokens will likely fare well during that period.
Definitely said, the things from above are the only speculation. The markets will decide what to do, on the basis on what the traders say they want. Experience has also shown what traders, investors, merchants, as well as customers really want. It is simple: they actually wish to secure finances, as well as a reliable way to store their money, At the moment, we see the early stages of a new evolution in both, and market players are groping their way through a maze of assets, fiat money, commodities, as well as cryptos.
No comments:
Post a Comment