Bloomberg analyst: Bitcoin is accelerating to replace gold

Mike McGlone, a top commodity strategist at Bloomberg Intelligence, shared his analysis on Twitter, noting that Bitcoin is accelerating to replace gold as a store of value in investors' portfolios.

While precious metals will always have a place in “jewelry and coin collecting,” Bitcoin appears to be “pushing out the old store of value,” replacing the metal as an inflation hedge.

According to McGlone, starting in 2017, investors generally chose Bitcoin over gold as a store of value, as shown in the following chart:

In addition to the asset’s faster appreciation relative to gold, McGlone is also bullish on Bitcoin’s price.

McGlone accurately predicted that Bitcoin would surge to the $50,000 mark and recently made a new prediction, saying that by 2025, the price of Bitcoin will continue to rise and eventually reach the $100,000 milestone, which is the target expected by many other Bitcoin bulls.

His prediction is based on the asset’s growing popularity and market sentiment even among mainstream investors. Experts have said that financial markets may even want to replace dollar reserves with digital dollars and Bitcoin.

Some Bitcoin enthusiasts, such as MicroStrategy CEO Michael Saylor, even suggested that investors sell gold and buy Bitcoin instead, arguing that "gold is dead money" and that "other people will sell their gold."

Peter Schiff, an avid gold advocate, has consistently refuted this claim, arguing that Bitcoin is a scam and that it cannot replace gold simply because of its price appreciation. Schiff's criticism of Bitcoin often annoys traders.

A trader specifically compared his investment in Bitcoin and gold. He claimed that after investing $1 in Bitcoin and gold respectively, after 11.4 years, Bitcoin rose to $66,542,100, while gold was only $1.63.

Not all indicators suggest that Bitcoin will replace gold in the short term, at least for now. It is undeniable that gold is indeed a good store of value compared to Bitcoin, and this trend will continue.

Although the market value of gold and Bitcoin is likely to be close in the next few years, for now, there may be a short-term correction in the exchange rate of gold to Bitcoin.

Each month, the TD Sequential data points to a reversal in gold’s trend against Bitcoin. This could be due to a Bitcoin crash, or due to a massive increase in gold relative to the cryptocurrency.

However, it is important to note that these signals can be ignored when an asset is in a strong enough trend . For example, a TD 13 sell signal from Bitcoin’s last major peak caused little change in the precious metal’s rally.

Bitcoin is on an upward trend in the long term, and gold is likely to fall relative to cryptocurrencies in the foreseeable future. The only question we need to worry about now is whether there will be a short-term reversal. (Blockchain Knight)