Bitcoin is often referred to as digital gold, but now the cryptocurrency is supposedly replacing real gold.
A recent report from JPMorgan says institutional investors are turning to Bitcoin, perceiving the crypto as a better hedge than gold. 📈 🚀
In the note, analyst Nikolaos Panigirtzoglou pointed out“The recent rise of the Lightning Network and 2nd layer payments solutions helped by El Salvador’s bitcoin adoption” as one of the main causes driving Bitcoin adoption.
The re-emergence of inflation concerns has forced investors to think about the usage of bitcoin as an inflation hedge, he said. Assurances by U.S. financial watchdogs saying that there is no intention to ban crypto has boosted confidence among investors, Panigirtzoglou added.
Moreover, since the beginning of 2021, more than $10 billion has flowed out of gold ETFs. In the same period of time, more than $20 billion has flowed into Bitcoin funds, according to the bank. Keep in mind, that doesn’t even include inflows on exchanges…
Bitcoin has climbed 86% this year (remaining firmly in bull territory, despite turbulence in the last few weeks.) 💚 Meanwhile, gold is down 7% YTD. So much for being an inflation hedge. 🙄