Quantcast

Cryptocurrency Crash Benefits Gold

The overall sector has shed trillions of dollars in value....

This week has been truly brutal for the entire cryptocurrency sector, with the prices of major currencies like Bitcoin and Ethereum crashing at least 30%.

The overall sector has shed trillions of dollars in value.

The recent carnage for holders of digital currencies could be due to a variety of factors including profit taking spurred by Elon Musk, an easing of inflation worries, or concerns about new regulations coming down the pike.

Whatever the case may be, some of the capital that recently left the crypto space has found its way into the gold and silver markets.

...article continued below
- Advertisement -

This trend could continue as well, with precious metals gathering strength and with Bitcoin still having plenty of room to fall further.

Bitcoin hit its lowest price since January as the People’s Bank of China has reiterated its view that the tokens cannot be accepted as a form of payment.

Since 2017, China has become an increasingly difficult adversary for cryptocurrencies and virtual products.

The communist nation has banned initial coin offerings while also forcing many exchanges to move overseas.

...article continued below
- Advertisement -

Bitcoin Balloon

China has been known to implement capital controls as it seeks to control the ebb and flow of currency within its borders.

A cryptocurrency can make these controls impossible to execute, however, as funds can be swiftly and easily transferred overseas.

The only digital currency that would allow China to maintain capital controls would be the issuance of its own digital currency.

China has reportedly already taken steps to introduce its own digital yuan, and the country looks to become more aggressive in the space.

In addition to China, the Bitcoin and crypto markets have also been negatively impacted by comments from Tesla chief Elon Musk.

Tesla recently purchased a large sum of Bitcoin as Musk seemingly wanted to push the use of the currency. Tesla has, however, reportedly retracted the notion that it will accept Bitcoin as payment.

Further commentary by Musk over the last several days has only added to the confusion.

The uncertainty surrounding cryptocurrencies has provided the gold market another boost. Although cryptos may be unregulated and can act as a hedge against rising inflation or weaker paper currencies, they do not have the long, reliable history that gold bullion does.

Given gold’s timeless role as a store of value and protector of wealth, some investors concerned about long-term capital preservation are likely to reconsider their affinity digital assets and turn toward bullion instead.

Meanwhile, rising Middle East conflicts are also fueling gold’s recent rise.

Israeli warplanes pounded Gaza this week in the face of Hamas rocket attacks on Israel, and any escalation in the conflict will underpin the bull case for precious metals.

To be sure, the current economic and geopolitical backdrops – while negative in many ways – are highly positive for gold and silver. But they’ve always been a hedge for turmoil.

If you already own some physical gold and silver bullion, now may be a good time to consider adding more. For those who do not currently own any of the monetary metals, it’s hard to imagine what else they could be waiting for!…Original Source

- Advertisement -

TRENDING NOW

12 Politicians Who Got Caught Violating Their Own COVID Rules

(Brad Polumbo, Foundation for Economic Education) Amid widespread panic and alarmism over the “Delta variant” of COVID-19, Mayor Muriel Bowser just reinstated an indoor mask-mandate...

‘Squad’ Urges Treasury Dept. to Revoke Tax Exemption of Pro-Israel Groups

The Marxist "Squad" sent a letter to Treasury Secretary Janet Yellen to request that her department review and revoke non-profit status from pro-Israel groups,...

Evidence Unearthed by GOP Strengthens Link Between Wuhan Lab & COVID Outbreak

Citing satellite photos, unusual funding requests and the deletion of an online database by China’s Wuhan Institute of Virology amongst other circumstantial evidence, the...

Border City of Laredo, Texas Sues Biden Admin Over Illegals

(Bethany Blankley, The Center Square) The Texas border city of Laredo has sued the Biden administration, hoping to halt its policy of transferring several hundred...

Silicon Valley Entrepreneur Donates $10M Each to America-First Candidates

Billionaire tech entrepreneur Peter Thiel, who co-founded PayPal and invested early in Facebook, gave $10 million donations to two political outsiders seen as America...

Political Hacks Concoct Excuses for Their Inflation

(Clint Siegner, Money Metals News Service) Jerome Powell, after last week’s FOMC meeting, said inflation has run hotter than expected. However, he wants to assure Americans...

Illinois Agency Says Trump Due $1 Million Tax Refund for Chicago Skyscraper

(Headline USA) An Illinois tax agency has ruled that former President Donald Trump is due a $1 million refund on the 2011 tax bill...

China & India Ignore UN Deadline for Pledges to Reduce CO2 Emissions

(Headline USA) China and India have missed a U.N. deadline to submit fresh plans for cutting their carbon dioxide emissions in time for the...

Biden & Congress Let CDC-Created Eviction Moratorium Expire

(Headline USA) Anger and frustration mounted in Congress over the weekend as a nationwide eviction moratorium expired. One Democratic lawmaker even camped outside the Capitol...
- Advertisement -