{"id":417528,"date":"2020-03-09T17:00:49","date_gmt":"2020-03-09T17:00:49","guid":{"rendered":"https:\/\/wncen.com\/?p=417528"},"modified":"2020-03-09T14:44:40","modified_gmt":"2020-03-09T14:44:40","slug":"crypto-analyst-digital-gold-bitcoin-recession","status":"publish","type":"post","link":"https:\/\/wncen.com\/news\/crypto-analyst-digital-gold-bitcoin-recession\/","title":{"rendered":"Crypto Analyst: Digital Gold Narrative Out The Window Amidst Crisis"},"content":{"rendered":"

Bitcoin<\/a> has long been referred to as digital gold, due to the crypto asset sharing many attributes as the precious metal that\u2019s often used as a safe haven during economic distress.<\/span><\/p>\n

But with a recession looming, and fears mounting by the day amidst a global pandemic and stock market selloff, that digital gold narrative should be thrown out the window, as Bitcoin and gold aren\u2019t showing anywhere near the same performance in the current market environment.<\/span><\/p>\n

Comparing Crypto to the Safe Haven Precious Metal<\/h2>\n

Bitcoin<\/a> was created by Satoshi Nakamoto in the wake of the 2008 financial crisis. The crypto asset, born from a recession, was created with certain attributes that would help it survive and potentially even prevent future recessions.<\/span><\/p>\n

These attributes include a hard-coded digital scarcity, that gives the asset a similarity \u2013 among others \u2013 to the precious metal gold.<\/span><\/p>\n

Related Reading | Correlated Chaos: Bitcoin, Dow, SP&500, and Gold Held At This Mathematical Level<\/a>\u00a0<\/strong><\/em><\/p>\n

Gold has been in use for thousands of years as a currency, commodity, and store of value and wealth. More recently, gold has earned a reputation for being a stable flight of safety for capital during economic downturns.<\/span><\/p>\n

Because gold behaves this way due to its scarcity, the crypto asset was also thought to have such a benefit. <\/span><\/p>\n

The safe-haven narrative really took off in 2019, as gold and Bitcoin began to rise together<\/a> as a trade war between China and the United States began to make an already tense economic climate that much more shaky.<\/span><\/p>\n

In the end, however, it was the coronavirus \u2013 a black swan event<\/a> \u2013 that was the pin that pricked the stock market bubble and caused the economy to begin to collapse.<\/span><\/p>\n

A recession is almost a guarantee at this point, according to financial analysts and many key metrics such as the unemployment rate<\/a>.<\/span><\/p>\n

Bitcoin Fails As Digital Gold Now That Recession Is Here<\/h2>\n

With a crisis here, Bitcoin<\/a> is failing to live up to the digital gold and safe haven narrative<\/a>.<\/span><\/p>\n

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Right about now the "digital gold" narrative is going out the window.<\/p>\n

Gold is doing what it is "supposed" to do in times of fear.<\/p>\n

Btc is doing what most rational people expected it to. pic.twitter.com\/Y2ZbQEASOB<\/a><\/p>\n

— A Voice of Reason in a Sea of Insanity (@sometrader78) March 9, 2020<\/a><\/p><\/blockquote>\n