Bitcoin: Investors Are Selling Gold To Invest In Crypto

Over 10 billion dollars were liquidated by the largest gold fund in the last 12 months, with the price of the precious metal falling by 6.1%

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Investors are selling gold to buy cryptocurrencies as inflation rises, abandoning the precious metal that has traditionally been seen as a means of securing the value of money.

According to a Bloomberg report, more than 10 billion dollars were liquidated by the largest gold fund in the last 12 months.

The price of gold fell 6.1% in the past 12 months to $1,782 per ounce, while Bitcoin doubled in the same period to a record level, surpassing $67,000 yesterday.

[mcrypto id=”79284″]

Investors Prefer Crypto To Gold in Times Of Inflation

There is a tendency now to consider bitcoin as a means of diversifying portfolios, with inflation being one of many catalysts,” said Mohamed El-Erian, Allianz’s chief financial advisor. “Bitcoin has attracted money that was placed in gold,” he added.

Paul Tudor Jones, a well-known hedge fund manager, told CNBC yesterday that he prefers cryptocurrencies to gold to be covered by inflation.

According to the Digital Belongings Examine, which surveyed 1,100 skilled investors, bitcoin’s lack of close correlation with the prices of various other assets and the sense of being a potential hedge against inflation has boosted its reputation in the investment establishment.

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More than half of hedge funds surveyed in Europe and the US reported that rising inflation is a key driver of digital currencies, with 8 in 10 saying they have a small percentage of cryptocurrencies in their portfolios.

“Institutional investors seem to be returning to bitcoin, possibly seeing it as a better security against inflation than gold,” analysts at JP Morgan said.

Proponents of bitcoin believe that its usefulness as a hedge for price increases stems from the gap that exists in the amount of bitcoin that can be created as opposed to the printing of money by central banks in the pandemic.

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