Bitcoin Superior to Gold amid Coronavirus Pandemic – Report

Bitcoin Superior to Gold amid Coronavirus Pandemic – Report

Coinbase, one of the leading U.S. crypto exchanges, has recently released a report, in which it stated that Bitcoin (BTC) managed to outperform the precious metal Gold during the coronavirus pandemic.

According to the report, the exchange claims the BTC has a substantial advantage over Gold. Coinbase added that the cryptocurrency reached this leading position due to lack of reliance on physical supply.

The platform went on to say:

Bitcoin and gold are fundamentally similar as scarce and globally accessible units of value.”

However, there was a decline in the recent supply of gold, due to the spread of coronavirus. Accordingly, Coinbase claimed the BTC is superior as regards its global accessibility.

COVID-19 makes BTC superior

The U.S. exchange stated:

“Bitcoin does not rely on fragile physical supply chains and is truly globally accessible.”

It highlighted the gaps recently found in the gold markets across the world, because disruption in supply chains led to significant levels of scarcity.

The reported showed that there was almost 4.5 percent divergence in gold prices in the U.S. and the UK, due to shortage of gold bars meant for the settlement of Comex’s futures contracts.

Impact of Covid-19 on BTC, gold mining

The report shed light on the impact of coronavirus on BTC and gold mining, stating:

“Gold refineries, miners, and supply chains have been disrupted, Bitcoin’s core protocol continues to function as designed.”

Meanwhile, the cryptocurrency’s hash rate is about to hit a new all-time high, due to the miners’ uninterrupted activities.

“Bitcoin will be approximately as scarce as gold, while also being teleportable. Today, Bitcoin’s rate of new supply is ~3.6% per year and will soon drop to ~1.7% on May 12th, setting it on par with gold’s historic scarcity.”

Bitcoin’s inflation rate likely to hit 1.8% after halving

When Bitcoin’s (BTC) halving happens, the cryptocurrency’s annual inflation rate would be almost half the global average.

Mati Greenspan, a crypto expert, said on his Twitter account that Bitcoin’s annual inflation (BTC) would decline from 3.65 percent to 1.8 percent when the halving happens. The global average inflation rate hit 3.41 percent last year, and around 3.56 percent so far in 2020.

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Rabea Maguid 551 Articles
Rabea Maguid is a journalist completely obsessed with crypto industry. He holds B.A. from Al-Azhar University, and has a background in journalism and economics. Rabea Maguid likes to think about the future in a positive way, and sees blockchain as a potential driver of deep societal change.