Bitcoin (BTC) continues to prosper in 2020 despite its high volatility

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This year it has been unexpectedly transformed by the Covid-19 pandemic, which reversed the conventional current of the economy. Although the economic projections before the pandemic were mostly positive, the entire focus now extends to how to recover from the cycle formed by the crisis that has affected the entire world.

Bitcoin, the OG among other cryptocurrencies has exhibited a lot about itself amid the pandemic. First, by not acting like a safe haven In the face of the crisis, rather it showed a high correlation with the S&P 500 index. Secondly, there has not yet been a gigantic increase in prices that the population expected after the Bitcoin's third halving, possibly due to low market confidence after the pandemic.

The scope of investment has evolved, including core assets as well. Vectors have now shifted to actions, corresponding to the new lifestyle dictated by post-pandemic reality, such as remote work technologies, online shopping, etc. Alternative investments like gold They also gained momentum, mainly due to their resistance to inflation and other market trends.

Bitcoin and gold: price analysis

Since the beginning of the year, Bitcoin has been going through peaks and valleys. Driven by the long-awaited halving in spring, its price began to rise throughout the winter period, until the effect of the pandemic hit the markets. Then Bitcoin faced an unprecedented price drop to $ 3,600 in March, which was the biggest single-point collapse in the past 3 years. Later, Bitcoin began a gradual recovery, which eventually led to an annual high of $ 10,230 on June 1.

Gold prices have followed the same general trend. Showing strong growth potential in early 2020, it later dropped sharply to the lower $ 1,300 price level in mid-March as part of overall negative consumer sentiment, in addition to fueling a long and strong recovery, which ultimately helped it . to hit the seven-year high of $ 1,630 on May 18.

Generally speaking, both Bitcoin and gold follow the same common trend of the S&P 500, which means they are still financially responsible. However, with other things the same, they can still count on a better growth potential in times of economic crisis, since the “decentralized” nature of both assets, as well as their production and obtaining, makes them less dependent on evaluation factors. common.

Final conclusion

Although according to bloomberg reportWith both gold and Bitcoin expected to outperform the traditional market, Bitcoin is still considered to be better storage of value.

Why? The answer rests on the cryptocurrency's technological base: blockchain, which allows for greater transparency, easy storage (gold is difficult to store), and one can easily get a stake even with the lowest portion of real Bitcoin (the gold is more difficult to subdivide). Combining all these factors, Bitcoin could have secured a 'digital gold' status.



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