Key Points
- Gold’s lower volatility compared to Bitcoin makes it more appealing amid market uncertainties, according to Maruf Yusupov, co-founder of Deenar.
- Bitcoin’s recent price drop and gold’s steady rise have triggered investor concerns and interest respectively.
Maruf Yusupov, co-founder of the gold-backed stablecoin Deenar, believes that gold’s stability gives it an advantage over Bitcoin during periods of market uncertainty.
Yusupov attributes Bitcoin’s recent fluctuations to the potential Interest Rate cut from the US Federal Reserve.
Bitcoin’s Fall and Gold’s Rise
On September 15, Bitcoin’s price fell below $60,000, sparking fears of a further decline among investors. Meanwhile, gold has been showing steady growth, which Yusupov suggests is due to investors’ wariness of the general market uncertainty.
Gold’s price increased by 0.04% over the past day and is currently trading at $2,584. This is in contrast to Bitcoin, which struggled around the $58,000 area, a 22% decrease from its all-time high of $73,750.
Gold as an Alternative
Yusupov states that gold’s limited volatility has made it a popular choice for investors looking to hedge against market uncertainty.
According to a report, the value of spot Bitcoin exchange-traded funds exceeded $61 billion in total assets under management, reaching 25% of gold ETF’s $257 billion in just six months.
The recent market unrest and mixed response to the U.S. Fed rate cut have led to increased outflows, with BlackRock unexpectedly joining the outflow trend.
Yusupov suggests that while it may be too early to say that traditional investors are shifting towards gold, the market data generally supports this theory.
Bitcoin’s value dipped by 0.24% in the past 24 hours and is currently trading at $58,500. The cryptocurrency market cap has fallen by 1.2% and is now at $2.13 trillion, according to CoinGecko.
This downward trend coincides with mixed reactions to the expectation of a 50 basis point rate cut by the U.S. Fed.
