Home Economy Bitcoin as good as gold as prices hitting record highs

Bitcoin as good as gold as prices hitting record highs

by

<?xml encoding=”utf-8″ ?????????>

The price of bitcoin and gold reached new highs as investors speculated on potential interest rate cuts by the US Federal Reserve in the middle of the year.

Gold rose to $2,133.50 an ounce, driven by expectations of lower global borrowing costs, a weakening US dollar, and the anticipation of a reversal in global monetary tightening.

The outbreak of conflict in the Middle East in October led to increased demand for gold as a safe-haven asset, similar to the surge observed after the Russian invasion of Ukraine. This boosted goldminers such as Fresnillo and Endeavour Mining, with both companies seeing significant gains in their stock prices.

Bitcoin, the leading cryptocurrency, also hit a record valuation of $69,202, marking its first new peak since November 2021. The record prices of both gold and bitcoin reflect investors’ search for assets with potentially higher returns amid expectations of central bank interest rate cuts over the coming year, which diminishes the appeal of fixed income assets like bonds.

Bitcoin’s rally has been fueled by an upcoming “halving” event scheduled for April, which limits future supply and increases demand in the short term. The last halving event in May 2020 preceded bitcoin’s significant price surge to over $68,000 in 2021.

The cryptocurrency’s recent surge has also been supported by the lifting of a long-standing ban on bitcoin exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC). ETFs offer a more accessible investment option, particularly for retail investors, and their introduction has contributed to the continued upward trajectory of bitcoin’s value since January.

Related News