For a long time the crypto market has not lived a week like this. And, most cryptocurrencies, including Bitcoin, have lost between a third and a half of their value in a matter of days. Leading panic within the crypto community, as many users sell their cryptocurrencies out of fear. Which, for some analysts, shows that investors exchange Bitcoin for gold, as Carl Quintanilla comments in the Tweet of the day, quoting JP Morgan:
Bitcoin for Gold?
For those of us who have been part of the crypto world for a while now, a drop in the price of cryptocurrency like the one experienced in recent days is nothing to write home about. Well, although Bitcoin went from 54,590 dollars to a floor at 34,923 dollars per BTC, on other occasions the cryptocurrency had had disasters of this type.
However, this time the stakes were higher. Well, after its last major bull rally, members of the crypto community began to defend Bitcoin’s position as a store of value higher even than gold. An argument that is difficult to defend when the value of the cryptocurrency collapses even when there are inflation fears.
For this reason, some analysts would already be relating the fall in the price of Bitcoin with the increase experienced in the price of gold. Which would lead them to conclude that institutional investors are abandoning their BTC holdings to invest in the precious metal. Precisely what the US bank JP Morgan says and that Carl Quintanilla replies on his Twitter account:
«JP Morgan: Institutional investors seem to move away from Bitcoin and back to traditional gold, reversing the trend of the previous two quarters».
Of course, correlation does not imply causality, and the fact that Bitcoin has experienced this collapse in its price does not mean that it will not recover soon, as it has done on other occasions, nor that capital is fleeing from BTC to gold. However, the fact that the price of BTC is falling right now makes it extremely difficult to justify the cryptoasset being perceived as an asset store of value around the world.