Many investors and traders are suffering from the COVID-19 pandemic which took a toll on all markets. However, some analysts believe that people are going to buy Bitcoin (BTC) in droves because there won’t be gold for sale due to the coronavirus. As we can see from the Bitcoin news now, Max Keiser thinks that gold is toilet paper for the rich, referencing to the value of the commodity in times of crisis.
In a recent edition of the Keiser Report and news program on March 31, the analyst said that the coronavirus pandemic will push a lot of billionaires to gold as their safe haven. Once the supplies are bought up and stockpiled, the only alternative that is left is Bitcoin.
“I predict — and this is not only the ultimate use case but the ultimate irony — that once people realize that they cannot get gold, they’ll start flocking en masse into Bitcoin,” Keiser said.
The basis for this claim was a report from Bloomberg from March 25 where the company warned that the gold industry was “facing unprecedented turmoil” due to a spike in demand.
As the cryptocurrency news outlets reported back then, the precious metal was rising while BTC was sinking. Gold has also seen noticeable price volatility in 2020 and went from lows of $1,469 just two weeks ago to highs of $1,629 which is an increase of 10.9% in just one week.
Currently, gold has a number of drawbacks over Bitcoin. In contrast to the cryptocurrency, gold is costly and risky to move – especially across borders. Generally, it needs a trusted third party to store it. Unlike it, the Bitcoin blockchain shows that there is also no way for the market to know in real-time whether a unit of gold is genuine or not.
This is why Keiser thinks that gold is toilet paper for the rich, referencing to the shortage of supply and demand at these times. Specifically, he previously stated:
“Remember: billionaires think of gold and silver the way the unemployed think about toilet paper.”
As we can see, gold is also afflicted by the phenomenon which has impacted every money in history besides Bitcoin – the higher its price is, the more effort humanity devotes towards increasing its supply.
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