Bitcoin Doesn’t Hurt Gold Demand – Goldman Sachs
Geoff Kerry, head of commodities research at investment bank Goldman Sachs, believes that the rise in popularity of cryptocurrencies is not affecting the demand for gold. He stated this in a conversation with the Financial Times.
In his opinion, the gold market is mainly represented by investors who are accustomed to working with futures, exchange-traded funds and other financial instruments that automatically fall under the requirements of regulators in the field of combating money laundering and terrorist financing, while the bitcoin market practically does not. regulated.
Bitcoin peaked last week above $ 18,000, up 1,700% over the year. At the same time, the price of gold reached its lowest value since mid-July this Monday at $ 1,242 per ounce..
“There has been no visible decline in the popularity of ETFs for working with gold. On the contrary, the total amount of capital invested in such ETFs recently peaked since mid-2013, ”said Curry..
He also pointed out that gold and bitcoin have completely different market characteristics. While Bitcoin’s capitalization is $ 285 billion, gold capitalization exceeds $ 8.3 trillion.
“While bitcoin has a mathematically defined emission and gold has a limited (albeit less defined) emission, even a cursory examination shows that the two markets have very different dynamics. We believe that the nature of the demand for bitcoin and gold is the key driver behind recent price movements. In our opinion, bitcoin attracts more speculative flows than gold. While lack of liquidity and increased volatility may continue to attract interest in Bitcoin, the likelihood of investors looking for diversification and the benefits of hedging is low. Over the long years of its existence, gold has established itself as such an asset, “he added..
Earlier, Goldman Sachs analysts published a report in which they came to the conclusion that gold is superior to Bitcoin for a number of reasons..
Photo: Roman Bodnarchuk
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