Gold Begins Breakdown Against Bitcoin, Triggering 90% Decline On Per Oz Basis

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Bitcoin price just set a new all-time high against the US dollar and other top global fiat currencies. But what might be even more significant, is the fact that the gold standard itself is breaking down against BTC after this latest rally.

The gold versus Bitcoin price chart shows that in the past, each time support broke down, the precious metal dropped 90% in value against BTC on a per ounce basis. Here’s a look at each 90% drop historically, and some insight as to why this is such a big deal for the emerging financial technology.

Bitcoin: The Dawn Of Digital Gold And A New Monetary Standard In The Making

2020 could go on to be remembered as the year Bitcoin finally matured and became the respected financial asset cypherpunks, millennials, and other early adopters realized years ago. The leading cryptocurrency by market cap has long been positioned as digital gold, designed to be such, and sharing so many of the key attributes that give the asset safe haven like properties.

The precious metal once underpinned the entire monetary system, until the gold standard was disbanded in the early 1970s. At that time, gold traded at $30 an ounce.

Today, it trades at around $1,800 an ounce, showing what an incredible investment the scarce asset made over the last 50 years. It took well-known boomers like Paul Tudor Jones to begin comparing Bitcoin to gold in the 1970s and highlighting its rarity, that goldbugs began considering the cryptocurrency alternative.

RELATED READING | GOLD CHART SHOWS WHY BITCOIN IS THE FASTEST HORSE IN RACE AGAINST INFLATION

Gold is archaic and in the post-pandemic, all-digital, and preferably decentralized world, Bitcoin is showing it is more valuable. A recent example where tonnes of gold was moved from a central bank in the Netherlands, requiring extensive planning, an armed guard transport, and costing millions. A BTC transaction could be done in a couple of clicks, and move that value without the cost, time, or effort associated with it.

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The BTC supply is more finite than gold also, and cannot be counterfeited. But these are just a few of many reasons the cryptocurrency makes for an even better version of gold than the precious metal itself.

bitcoin digital gold xaubtc btc xau

Gold is breaking down against BTC, leading to a potential 90% decline | Source: XAUBTC on TradingView.com

institutions and hedge funds who make up much of the $10 trillion gold market cap are starting to wake up to this fact, and are reallocating money into Bitcoin. The trend is clear on the XAUBTC price chart, where gold is now breaking down against Bitcoin from support set back at the previous peak.

RELATED READING | FUTURES AND FUND FLOWS SHOW BITCOIN IS REPLACING GOLD

There was once a time an ounce of gold cost hundreds of BTC. At the peak in 2013, Bitcoin reached price parity with an ounce of gold. Today, a gold bar is worth just 0.1 Bitcoin, and after each breakdown of support, the cryptocurrency gains another 90% against the hard money standard.

After another 90% decline, and the price per one-ounce gold bar reaching one-tenth the price of a Bitcoin, the world might need a new standard.

Featured image from Deposit Photos, Charts from TradingView.com

Source: https://bitcoinist.com/gold-begins-breakdown-against-bitcoin-triggering-90-decline-on-per-oz-basis/?utm_source=rss&utm_medium=rss&utm_campaign=gold-begins-breakdown-against-bitcoin-triggering-90-decline-on-per-oz-basis


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