Bitcoin is frozen in one place and seems to be hibernating the next hike in the area of $ 20,000. And while there is no movement and the technical picture remains unchanged, the market is again talking about the fact that investors are increasingly giving more interest to cryptocurrency than gold, and there are several objective reasons.
According to a report from one hedge fund, which manages $ 7.5 billion, gold will continue its growth to new highs next year. However, investors looking for alternatives may well pay attention to bitcoin. Next year, many central banks in developed countries plan to start revising monetary policy against the backdrop of a severe increase in inflation, which is another argument in favor of gold as an asset that protects against inflation.
Unsurprisingly, investors keep an eye on the US Central Bank's comments as inflation gradually picks up, and policymakers move closer to scaling back huge asset purchase programs. The observed monetary support has already led to a record reading of the Fed's balance sheet, which could pose serious risks to the value of the US dollar in the future, potentially increasing the attractiveness of other alternative instruments.
Most likely, both assets will be in serious demand, which will eventually show how much investors trust new technologies and how much they believe in the fundamental component of cryptocurrency. Former Treasury Secretary Lawrence Summers believes that cryptocurrencies can represent something similar to digital gold. Some portfolio managers also try to stick with bitcoin and other cryptocurrencies because they have much more room for growth. Even despite the high volatility and instability of the world's first cryptocurrency, the profit from it is much greater than from investing in gold.
As for the numbers, since the growth of bitcoin, there has been constant talk about whether the digital token will outrun gold and take its privileges. Back in March of this year, gold was close to plunging into a bear market. However, it sharply changed course amid changes in the attitude of the authorities to monetary policy.
Leading Wall Street banks are divided into two camps: Citigroup Inc. said that gold "loses its luster and attractiveness" compared to cryptocurrencies. However, Goldman Sachs Group Inc. believes that these two assets can coexist in parallel with each other. Last year, gold reached a record high (above $ 2,075 per ounce). However, it quickly corrected, and the attention of investors turned to bitcoin and other digital assets.
In digital currencies, it is worth paying attention to the recent statements of representatives of the Bank of England. The report says that most of the deposits in retail banks can be converted to digital currencies if governments start offering them. The UK Central Bank has modeled the introduction of the digital pound into the retail banking sector and considered what would happen if a fifth of all deposits went digital. Economists did not see anything critical in this. However, they noted that any large-scale redistribution of funds could affect the money markets. The findings point to the scale and complexity of the challenges that will arise as the Central Bank modernizes its working methods and attempts to link payment systems to the digital national currency. However, the same model showed that the introduction of digital assets would help simplify the work with online payments.
"We live in an increasingly digital world in which the way we make payments and use money is changing rapidly," Bank of England Governor Andrew Bailey said in a statement. "The prospect of stablecoins as a means of payment and the new CBDC offerings have created many challenges that central banks, governments, and society at large must address in the near future."
Thus, the Bank of England is on a par with the Fed, the ECB, the Central Bank of China, and Japan, which are actively engaged in developing and introducing their national digital currencies.
As for the technical picture of bitcoin, it has not changed much. Bitcoin continues to wobble along the channel from side to side, licking its middle in the area of 36,300. Its breakdown leads to pressure on bitcoin and a decline in the area of lows - to 31,000. Its break up will allow traders to push bitcoin to the upper limit (41,100), where the pressure returns. We will be on this channel for quite a long period.
