Goldman Sachs Group Inc came to the conclusion that gold prevails cryptocurrency,
taking into consideration the majority of core features of money. By all means wealth and fear exert strong
influence on gold bullions.
IS IT STILL EARLY TO GIVE UP ON THE NOBLE METAL
As analysts Michael Hinds and Jeffrey Currie write, though the lack of profit nobel metals stay a current asset
type in portfolios nowadays. They enhance the role of gold by adding that the noble metals are neither a casualty of history nor a relic. If judging by the persistence and actual cost they are still applicable even when new asset types like cryptocurrency emerge, according to the analysts.
The increase of ambiguity causes boom of gold in investor portfolios. Along these lines fear becomes a crucial factor of the momentary growth, reportedly to Goldman. In its turn wealth dictates a further fate for
a longer period, which is particularly true in the developing markets like China. It was further alleged that the
revenue increase of few previous decades would underpin prices in the Celestial Empire.
WHAT’S THE DIFFERENCE BETWEEN BITCOIN AND GOLD? BY GOLDMAN SACHS
This year Bitcoin showed phenomenal growth by rising towards $6,000 taking start with only $1,000 at the
year beginning. In return the gold cost rose by 12%. The bank specified few peculiarities for their comparison, emphasizing their focus not on the blockchain technology but on the currency.
These characteristics are as follows:
Durability: For a proper permanent storehouse both assets demand certain experience, nevertheless gold
succeeds here, as cryptocurrencies are exposed to online purses or computer and smartphone users hacking. They also run the risk of new regulatory, as well as network and infrastructure risks throughout
Portability: To transfer gold bullions can cost a pretty penny, taking into account the weight of the metal
and the highest possible security level that it requires. Furthermore one should bear in mind high import taxes in several countries, for example in India. Undoubtedly the shifting of Bitcoins is much faster and not such expensive.
Actual value: The earth’s crust bears a limited supply of precious metals, while with cryptocurrencies it’s
quite easy to produce some alternatives. This means that at the macroeconomic level it is virtually impossible to control their supply. Therefore the actual value vanishes taking into consideration its rarity.
Monetary unit: With regards to the purchasing capacity, gold shows itself better and has got less daytime volatility. In 2017 the average Bitcoin/dollar volatility outweighed the corresponding index of precious metal almost sevenfold, the bank reported.