Bitcoin outperforms gold – Lendo platform
As Coindesk reports, bitcoin (BTC) has seen double-digit gains in October and is outperforming gold for the first time since June.
BTC ended the month with a gain of 10.26 percent, reversing a three-month losing streak, according to Bitstamp data. Meanwhile, gold gained just 2.74 percent in October, having dropped 3.17 percent in September — the biggest monthly drop since June 2018.
Throughout the year, gold and BTC have been engaged in a battle for supremacy and while BTC outshone gold by big margins in the five months to June, the tide turned in favour of the precious metal in the third quarter. This downturn in BTC’s fortunes was partially attributed to a sell-off related to Facebook’s Libra and the possibility that it might be fast-tracked through the regulatory system. As a result, gold prices surged in July and August. In September both gold and BTC experienced a fall, although it was more serious for BTC.
However, things were much brighter for BTC in October, and it is predicted that the leading crypto will continue to outperform gold in November.
Other influences may be the 31st October announcement by the Federal Reserve Bank that it would pause rate cuts to assess incoming data before considering lowering borrowing costs again. Coindesk says, “Gold, a zero-yielding asset, usually cheers dovish Fed policy and faces selling pressure when the central bank signals a pause or rate hikes.” So, not good news for gold.
Furthermore, the ongoing rally in the US stocks may be good for BTC. Analysts at Delphi Digital wrote in their monthly report: “Prior bitcoin bull runs were characterized by a gradual decline in equity market volatility. For example, we’ve noted its, albeit imperfect, inverse relationship with the VIX Index over longer time horizons (i.e. 2017 run-up).”
Published at Tue, 05 Nov 2019 07:32:53 +0000