“Uncanny Pattern Resemblance”
Since Bitcoin’s inception a decade ago, many have likened this decentralized digital asset to gold, with some dubbing Satoshi’s brainchild as a form of “digital gold.” This connection may be drawn due to the fact that the two individual assets are both stores of value, divisible, durable and secure.
Although there are similarities between the two assets that are as clear as day, as recently pointed by Nunya Bizniz, a lesser-known cryptocurrency proponent, there might be an “uncanny” line that can be drawn between the price action of gold and its digital counterpart.
On Thursday, Bizniz took to Twitter to bring up two separate charts, with the first being gold’s 43-year price history and the BTC’s price action throughout the entirety of its nine-year lifespan. Putting the charts (which are logarithmic/non-linear) side-by-side, it becomes apparent that there are clear parallels, or as Bizniz puts it, “uncanny,” even though the two stores of values may be inherently different at their core.
As seen in the tweeted image (above), the price action of both markets have seen similar bouts of exponential increases and subsequent ‘cooldowns’, leading some to ask if BTC is following in the footsteps of gold in some manner.
In a tweet posted just days after the original, the user brought up a zoomed-in chart of the two assets to back up the belief that they could be correlated. According to the tweet, if BTC is really following gold’s path, that could mean that the price of the foremost crypto asset could move under the ever so important $5,800 support level over the next few months.
However, as covered by Ethereum World News, Gabor Gurbacs, the director of digital asset strategy at VanEck/MVIS, claims that BTC could be worth upwards of $20,000 if it can succeed in a role as a primary form of digital gold. Gurbacs explained his prediction, stating:
Investors do refer to Bitcoin as a form of digital gold and gold today has around $7 trillion outstanding. If you take, say, 5 to 10 percent — I’ll let everyone do the math — Bitcoin has upside. Bitcoin is used as digital gold today. It’s a de-risk asset.
CryptoOracle Executive: Bitcoin Is Functionally Better Than Gold
Postulated price correlation aside, there are many that think that Bitcoin is actually superior to gold, as it has certain functions that make it an appealing investment, while also being functionally better than the yellow metal that humans have come to love over the course of written history.
As reported by Ethereum World News previously, Lou Kerner, co-founder and partner at CryptoOracle, “the first community-first crypto VC,” recently spoke with CNBC to reveal that Bitcoin may actually one-up gold in certain areas. Speaking on CNBC’s “The Coin Rush” segment, which holds a focus on cryptocurrencies and blockchain technologies, Kerner noted:
Gold has emerged as the global store of value and it has held that position for literally a couple thousand years — that’s an awesome run. So we now we have something (Bitcoin) that we think may be functionally much much better. So we expect that over time — not in a day, not in a week, not even in 5 years, — for some of the people using gold as a store of value to switch to Bitcoin.
While the crypto asset proponent didn’t mention any specific drawbacks of gold or positive aspects of Bitcoin, it could be assumed that he sees Bitcoin’s ease-of-use, immutability, digital nature as reasons why some forward-thinkers would see value in the use of BTC.
Image Courtesy of Michael Steinberg @ Pexels