Everybody says Bitcoin is Gold 2.0 is the new digital gold and will replace gold, an inflation hedge like Gold. Bitcoin & Gold properties are matching except for 1 thing:
- Bitcoin seen as Risk On Asset instead of Risk Off like gold, so in times of economic uncertainty Gold price soars because its risk off and in uncertain times stock market crashes & crypto crashes.
So if Bitcoin is store of value like gold and does the same as Gold then why isn't it classed as Risk Off status like Gold?
In times of economic uncertainty where risk on markets crashing everywhere Bitcoin should be the hedge king right rising up and not be correlated to risky stocks correct?
It's because crypto is super volatile. I can understand that cryptocurrency, especially Bitcoin has outperformed almost all other asset classes in the last decade, but it's still very volatile and quite new compared to other assets.
Also there is political reason. Cryptocurrency can effectively zero down the need of a banking system. So the traditional finance people never liked bitcoin at the first place. They are doing their best and running mass campaigns against cryptos in many countries.
So even if cryptos have all eligibility to become a risk-off asset, it wouldn't get the tag after all.