Between the 12th and 13th of April, Bitcoin (BTC) prices dropped by a significant 13.3%. This steep decline forced numerous leveraged traders to sell off their holdings. The result was approximately half a billion dollars in liquidations and a decrease of over $5 billion in open interest.
Despite the recent bounce back in Bitcoin’s price to $62,600, some experts dismiss it as mere market volatility. However, other analysts argue that the frequent price drops undermine Bitcoin’s reputation as a reliable store of value, particularly when compared to gold’s stability during geopolitical upheavals like war.
Gold may be unpredictable in terms of its price fluctuations, but it has consistently demonstrated value as a reliable asset for preserving wealth. Currently, gold is priced at $2,350 following its peak of $2,432 on April 12 – a new record high.
Gold prices surged based on speculation about an imminent Iran attack, but then dropped when Iran denied the accusation and closed lower on Friday. However, since crypto markets are open 24/7, there was volatile trading over the weekend, and gold is typically not considered a safe-haven asset during economic turmoil like Bitcoin.
— Tom Linn (@TomLinn14) April 14, 2024
According to Tom Linn’s report, gold remains a preferred safe-haven asset over Bitcoin due to its historical price growth during conflict periods, whereas Bitcoin has yet to demonstrate such value appreciation in turbulent times.
It’s also possible to contend that large traders are the primary buyers of Bitcoin options and futures contracts, given that the data shows high demand from them. The annualized return on investment for these Bitcoin futures was over 10%, indicating a belief among investors that this digital currency offered lucrative opportunities for profit.
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2024-04-16 03:00