2020 has been a year of uncertainty. Not only did a pandemic take down markets the world over, but the crypto-market wasnt immune either. With the end of the year looming, it would now seem that many investors are having a different sort of dilemma. With the market just beginning to price in the effects of the Pfizer and Moderna COVID-19 vaccines, many are confused about the behavior of certain safe-haven asset classes.
Source: Weiss Crypto Ratings
According to a report by Weiss Crypto Ratings, after the Pfizer news, Gold and government bonds fell sharply after fears about an uncertain recovery in a post-pandemic world unraveled.
Bitcoin, however, remained strong after the news, climbing from $17,000 to $19,000, before corrections eventually set it. In fact, the price of the cryptocurrency was consolidating around the $18,500-mark, at the time of writing.
Once fiat currencies become digital, the value of government bonds can be inflated at a much faster rate. While the value of Gold may be beyond the governments ability to influence, confiscation-proof ownership is difficult to achieve with an asset that is not easy to store, Weiss argued.
Ergo, one can argue that cryptocurrencies that are stored on decentralized blockchains and enable complete, direct control of assets are the need of the hour.
Ok, last bomb – I have a sell order in tomorrow to sell all my gold and to scale in to buy BTC and ETH (80/20). I dont own anything else (except some bond calls and some $'s). 98% of my liquid net worth. See, you can't categorize me except #irresponsiblylong Good night all.
— Raoul Pal (@RaoulGMI)
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