Popular safe haven gold recently saw its lowest settlement in three weeks as a firm dollar and bond market yields weakened support for the precious metal. The financial goliath BNY Mellon also released a report on the differences between gold and bitcoin. The study states that the crypto asset “fits the description of an emerging currency”.
A firm dollar and government bond yields take the pressure off gold’s market performance
The US dollar has risen some strength in the past two weeks and crypto assets like Bitcoin (BTC) have also gained in value. However, the precious metal (PM) gold has seen better days as gold prices have fallen in recent weeks. The price of gold fell below the $ 1,700 an ounce area last week, but today the prime minister managed to climb back above the psychological price zone. At the time of writing, an ounce of 0.999 fine gold is trading at $ 1,716.30 after rising 1.7% in the past 24 hours.
Today’s gold and silver prices.
Gold bugs and economists have discussed Joe Biden’s proposal $ 3 trillion stimulus packageand it could boost gold, silver, and other types of assets that are seen as a hedge against inflation. Kitco Metals’ Jim Wyckoff said the dollar’s recent surge and insane government bond yields “are limiting buying interest”.
“The bulls in the gold and silver markets need a fundamental spark,” said the senior analyst at Kitco Metals. Wyckoff also noted that the top two PMs, gold and silver, saw “technical selling pressure from short-term futures traders amid the still bearish short-term charts.” While gold was in a slump, cryptocurrency markets experienced a new passion after prices fell from highs set on March 13, 2021.
BNY Mellon Report compares Bitcoin and Gold
In addition, the financial institution BNY Mellon has published one comprehensive study on the attributes of the Crypto Asset Bitcoin (BTC) and PM Gold. BNY Mellon’s report takes up the controversy Stock-to-Flow Ratio (S2F) and Creator’s Alternative Plan B model known as the Stock-to-Flow Cross-Asset Model (S2FX).
“The implication of this model is that Bitcoin is gaining more mainstream momentum and being viewed more than gold,” the report by BNY Mellon said. “The scarcity value (measured by S2F) and the subsequent halving will ultimately drive prices into the gold point cluster and imply total market value.”
The researchers at BNY Mellon are not buying the digital gold theory and stressed that BTC “fits the description of an emerging currency”. Although the financial institution’s report says Bitcoin may have gold “Similarities ”and that BTC could look up to the popular prime minister.
“Bitcoin is also often compared to gold,” says the study by BNY Mellon. “Indeed, there are many similarities and gold is a worthy role model for Bitcoin. After all, gold has been accepted as a store of value and a medium of exchange for centuries (nowadays almost no gold is used as a medium of exchange). We believe gold is that too Just a globally accepted “currency” that has circumvented the problem of the sanctioning bodies. “
However, in mid-February 2021, BNY Mellon set up a digital currency unit that is supposed to “hold, transfer and spend” Bitcoin.
What do you think of gold’s recent performance and BNY Mellon’s bitcoin and gold comparisons? Let us know what you think on this matter in the comments section below.
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