Report: Bitcoin is more attractive than gold.. for these reasons

A report published by the American magazine "Forbes" concluded that the digital cryptocurrency "Bitcoin" is better than gold in the field of investment, and as a hedging material during crises, due to the recent fluctuations witnessed by global markets, which blew up the theory that claims that gold is a safe haven and the best commodity during unsafe times.

According to the report, which "Al Arabiya Net" reviewed, the comparison between gold and Bitcoin is due to many basic characteristics that both assets share, as they have a limited supply (although the actual limit for gold is still undetermined), and investors and analysts often describe it as an anti-dollarization of the economy or as a hedge against inflation, and for most investors, these assets constitute only a modest percentage of total investments.

The report said that the recent sales sparked fears of a recession in the United States due to weaker-than-expected economic data and the sudden increase in interest rates by the Japanese Central Bank, which extended across global markets and asset classes.

Bitcoin cryptocurrency

Bitcoin and other cryptocurrencies were not spared from the selloff, with prices briefly falling below $50,000 before recovering in the days following the selloff.

According to Forbes , such volatility and the seemingly direct correlation between Bitcoin, other cryptocurrencies, and financial markets in general undermine the theory that Bitcoin is a digital version of gold.

The report says that the recent selloff was the first major correction and decline for cryptocurrencies since individual and institutional investors gained exposure to Bitcoin through spot exchange-traded funds that launched in January 2024. Even as prices continue to recover from the selloff, several important facts are worth highlighting as positive developments.

First, according to research by Bloomberg Intelligence , amid the first major price decline since its inception, only about 0.3% of assets under management in these exchange-traded funds remained.

Additionally, cryptocurrency wallets holding between 1,000 and 100,000 BTC consistently increased their holdings during the sell-off, indicating that long-term investors and potential institutional investors retained confidence in Bitcoin’s value proposition.

The report also notes that as of August 7, Morgan Stanley has begun allowing its 15,000 financial advisors to offer spot Bitcoin ETFs to wealth management clients who meet certain qualification criteria. Morgan Stanley’s wealth management business had nearly $6.6 trillion in assets under management at the end of 2023.

Unlike gold, which has remained unchanged for thousands of years, Bitcoin and crypto assets more broadly represent significant technological innovation and progress on several fronts, according to Forbes.

The report concludes that “Bitcoin is not gold, but it is better than gold,” both in terms of investment and in the long term for many capital owners.