The cryptocurrency and stock markets saw much turbulence in the past week. Specifically, growing fears over the coronavirus’ spread went on to cause the biggest weekly losses since 2008. Specifically, gold is also tumbling – despite often being seen as a “safe haven”.
Gold tumbles on concerns over the coronavirus
Traditional investors will be painfully aware that the past week brought the worst losses since the recession of 2008. Stock markets around the world fell dramatically as news of new coronavirus outbreaks in much of the western world broke.
Bitcoin was not immune to this massive market correction. The past week left the cryptocurrency markets blood-red, after Bitcoin fell below the $9,000 line in a flash Bitcoin crash. Bitcoin has since begun a slight recovery, and is currently stable at a price point of roughly $8,700.
However, some cryptocurrency critics took this opportunity to suggest that this disproves the thesis that Bitcoin is a “safe haven”. Disregarding the fact that the stock market also fell significantly, some said that Bitcoin’s price drop suggests it is not, in fact, “digital gold”.
For example, Peter Schiff recently said that Bitcoin “suckers” are wrong about Bitcoin’s safe haven status. Moreover, Schiff also said that gold is superior to Bitcoin. With that said, however, gold has also had a tough week.
Gold fell by seven percent in the last five days
In fact, the last five days saw the price of gold drop by roughly seven percent. This is extremely notable for an asset that’s as stable as the premier precious metal is. Additionally, a weekly drop of seven percent lines up nicely with Bitcoin’s weekly loss of nine percent.
As such, it would seem that gold and Bitcoin have both been roughly as stable as each other during this market crash. Nevertheless, whereas some observers ridicule Bitcoin for its price dip during the past, it will be hard to find any that do the same to gold.
In fact, Schiff actually took it upon himself to comment these latest news regarding gold’s price plunge. “Today’s 4% drop in gold is a very rare move in a single day. But it does happen occasionally,” Schiff said in a tweet on Friday.
“However a 4% drop in @Bitcoin is quite common, which often posts daily declines much larger. Today’s move doesn’t invalidate gold’s safe haven or long-term store of value status.”
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the blockchain industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.