Dumping Gold for Bitcoin... Hello $100k
The bitcoin price continued its upside trend on Wednesday, setting another all-time high above $51,700. The flagship cryptocurrency also saw its market cap surge past $960 billion for the first time following the spike towards $52K. Bitcoin has now gained more than 1100% from its March 2020 lows.
Meanwhile, the price of gold dropped by about 9% from its year-to-date high of $1,959. The precious metal, which is considered BTC’s top safe-haven rival, declined after a sell-off in the US bond markets pressured its spot price lower.
The drop in gold prices prompted Holger Zschäpitz, senior editor of finance at Germany publication Die Welt, to predict that more mainstream investors will likely dump gold for bitcoin.
He shared the chart below showing that BTC was eating into gold’s market share, adding that the gold/bitcoin ratio had fallen to historic lows.
Bloomberg strategist Mike McGlone shared a similar sentiment in his market outlook published earlier this month.
“Outflows from gold exchange-traded funds and inflows for products tracking the benchmark crypto support a potential paradigm shift,” McGlone wrote.
BTC Price Continues to Exceed Expectations
The recent bitcoin uptick defied the expectations of Peter Schiff, a well known gold bug and long-term crypto critic.
Schiff, who had predicted that BTC prices would never hit $50K in a 2019 tweet, was on the receiving end of some ridicule from the bitcoin community on Tuesday. After he was proven wrong on Feb 16 when BTC breached the $50K level, Schiff was forced to revise his stance on the king coin.
“Now that bitcoin has hit $50,000, I must admit that a move up to $100,000 can’t be ruled out,” the bitcoin skeptic tweeted.
In the coming weeks and months, BTC will likely see further adoption from gold and the US dollar dumpers as it continues to extend gains. The coin’s latest rally above $50K emboldened Ronnie Moas, the founder of Standpoint Research, to set a price target of $112,000 for 2021.
ETH Price Remains Well Supported
Ether is currently struggling to gain momentum above $1,850. The top altcoin faced a downward correction earlier today and broke the $1,800 support level after topping near $1,835.
However, the world’s second largest cryptocurrency remained well supported at the $1,700 zone and climbed back up to its current price of $1,820.
The ETHUSD pair is likely to accelerate higher above $1,850 in the coming sessions, but it must first clear the trend line resistance near $1,800.