Bitcoin takes away the charm of gold. In a note to investors, JP Morgan, the leading US investment banking firm, said Bitcoin appears to be a better inflation hedge than gold. Bitcoin supporters have long tried to claim that the cryptocurrency promises better and faster returns than gold and many people prefer it as a store of value. Both traits are commonly associated with gold. However, critics say that Bitcoin is extremely volatile and there is no guarantee that it will always have a growth path.
Still, Bitcoin price surpassed the $ 50,000 mark (roughly 37.56 lakhs) for the third time this year. While this shows Bitcoin’s susceptibility to rising and falling in rapid succession, it also suggests that an investment in Bitcoin can ultimately pay off.
“Institutional investors seem to be returning to Bitcoin and may see it as better inflation protection than gold,” said JP Morgan’s note. Regarding the company’s observation, Fortune magazine said the note is “no surprise” to those who have closely followed Bitcoin’s performance this year.
Bitcoin has seen high volatility this year. It broke the $ 50,000 mark for the first time in February and then hit an all-time high of about $ 64,000 (48.08 lakhs) in April. That bull run was interrupted by a massive crash in the cryptocurrency market in May and Bitcoin lost all of its profits that year, reaching a trade value of under $ 30,000 (22.53 rupees). It took some time to wake up from this slumber, and in July it was back trading at around $ 40,000 (30.05 lakhs rupees). Bitcoin broke the $ 50,000 mark again in August, but lost profits. A month later, it hit the milestone for the third time. Bitcoin was trading at $ 54,719 (Rs. 41.11 lakhs) on Saturday afternoon.
JP Morgan believes this third rally will be fueled by “the resurgence of inflation concerns among investors” and they are trying to use bitcoin as a hedge against it.
Interested in cryptocurrency? We discuss everything about crypto with WazirX CEO Nischal Shetty and WeekendInvesting founder Alok Jain on Orbital, the Gadgets 360 podcast. Orbital is available on Apple Podcasts, Google Podcasts, Spotify, Amazon Music, and anywhere you get your podcasts.
Comments are closed.