Why Crypto Will Outperform Gold and Gov. Bonds in a Post-COVID World

Source: Adobe / Siraphatphoto

Juan Villaverde has been an economist and mathematician since 2012 and deals with the analysis of cryptocurrencies Weiss Ratings Team of analysts and computer programmers who created Weiss cryptocurrency reviews.
Dr. Bruce Ng is an educator in the field of Distributed Ledger Technology (DLT) and has been a leading crypto-tech analyst for Weiss Cryptocurrency Ratings shortly after its introduction.
____ ____

The latest news that Pfizer and Modern working COVID-19 vaccines have hit the investment markets out of the blue.

Investors everywhere rushed to find out who would be most successful in a post-COVID world … and who would not.

One mindset was that a viable vaccine would lead to a quick recovery from the hardship and discomfort caused by pandemic lockdowns around the world.

Because of this, previously battered “old economy” stocks jumped into the news, while tech-intensive, so-called “stay-at-home” stocks – which benefited from the status quo of the pandemic – lagged.

However, the behavior of Bitcoin (BTC) was more interesting compared to classic safe-haven investment sectors such as gold and government bonds.

The graph below shows the price path of each one immediately before and after the Pfizer bomb.

Bitcoin versus gold and bonds

Why Crypto Will Outperform Gold and Treasuries in a Post-COVID World 102
Percentage change of Bitcoin (in blue) versus gold (in red) and US Treasuries (in green) on the day Pfizer announced a working COVID-19 vaccine.

As global markets tumbled on price in a rapid post-pandemic recovery, fears about the future vanished.

That tore out the carpet of safe port investments – like gold and government bonds. As you can see, they both rolled off the edge of the table together.

Bitcoin, on the other hand, was strong – although it was itself an important safe haven investment. In addition, this remarkable directional divergence continues.

Since then, gold prices have been basically dead in the water. Bonds could only reclaim about two-thirds of their post-Pfizer slump.

Bitcoin, on the other hand, blew up USD 17,000, USD 18,000 and USD 19,000 in a short period of time.

This increasingly reinforces the idea that Bitcoin is much more than just a safe haven when it comes to storing value.

The investment world is getting more optimistic every day. You can also see this in how virtually every major drop in Bitcoin prices this year has sparked a bargain spree.

And that’s not all: The expectation of a post-COVID world has also awakened a previously sleepy sector of the crypto markets: the Ethereum (ETH) and the Altcoins.

Bitcoin versus Altcoins

Why Crypto Outperforms Gold and Treasuries in a Post-COVID World 103
Percentage change in Bitcoin (in blue) versus Altcoins (in yellow) on the day Pfizer announced a working COVID-19 vaccine.

As you can see, both Bitcoin and Altcoins initially went back together when the Pfizer news was released – in sympathy with the Safe Haven sell-off. But only for a few minutes. Then both reversed course and spiritedly moved upwards.

This is a big deal because since Bitcoin bounced back from the September crypto correction, the altcoins have been pretty much in the mud.

That is absolutely no longer the case. Bitcoin and the altcoins are both stronger now. Together.

It does this while traditional safe havens struggle, which makes this even more impressive. All of this confirms something we have said a long time:

  • Crypto assets stand alone at the interface between cutting-edge technology and solid money.
  • This makes them the only sure defense against the imminent digitization of fiat money and the reckless monetary policy that will accelerate it.

We are fast approaching a post-COVID world where crypto will be the only viable safe haven. Think about it.

  • The value of government bonds can be inflated at will by unelected central bank bureaucrats. And once fiat currencies go digital, they will have the technology to inflate at the speed of light.
  • Indeed, gold may be beyond the government’s ability to corrupt. But it is so heavy and difficult to store that it is difficult to get a seizure-proof property.
  • Only cryptocurrencies (such as Bitcoin) that are stored in decentralized blockchains give you complete and direct control over your own assets. No matter how unfavorable – or deliberate – you may be from powerful government or gangland figures.

As the world slowly but surely wakes up to this reality, crypto assets are about to embark on their most explosive bull market run ever. And it can’t be very far away.
____ ____
Learn more:
New Bitcoin Narrative Targets Multi-trillion Bond Market
The Bitcoin Playbook: Two-digit rally -> two-digit sell-off -> pump again
Crypto in 2021: Institutions prefer Bitcoin, retailers open to Altcoins