Gold has been one of humanity’s most valuable metals throughout history. Additionally, gold has been seen as a safe haven in times of economic uncertainty and has been evaluated by investors as part of their portfolios. In recent years, Bitcoin, which emerged as a digital asset, has rapidly gained popularity as an alternative store of value and means of payment to traditional financial systems. Comparing Bitcoin with gold, with its similarities and differences, has brought about important discussions about the role and future of cryptocurrencies in the financial ecosystem.
While Altcon-Bitcoin comparisons continue, CryptoQuant’s Co-Founder Ki Young Ju puts forward allegation, started an important discussion in the cryptocurrency world. Citing past Gold ETF data, Ju suggested that the $46,376 level could be a sort of eternal floor price for Bitcoin. To support his claim, he recalled that in 2004, when the Gold ETF (GLD) made its debut on the New York Stock Exchange (NYSE), the price of the precious metal was around $444. Since then, Gold has never returned to this price level.
#Bitcoin‘s first spot ETF was approved in January 2024 when its price was $46,376.
NYSE listed the first gold ETF in Nov 2004, and the price never came back. https://t.co/aiDB3ie4Um pic.twitter.com/y5YG4LGj07
NEWS CONTINUES BELOW— Ki Young Ju (@ki_young_ju) March 7, 2024
The logic behind Ju’s claim points to the stabilization of the Gold price, as the interest in Gold from institutional investors around the world increases, following the launch of the Gold ETF. However, Ju noted that the factors affecting the price of Gold include not only economic but also demands from institutional investors. This underscores the role an ETF plays in gaining an asset’s popularity and supporting its price.
However, there are also those who oppose Ju’s claim. Some top analysts argue that comparing Bitcoin to Gold is inaccurate. However, at the center of this discussion is the importance of accessibility created through ETFs. At this point, Ju states that the accessibility created by ETFs supports the price of assets by increasing liquidity in the markets. According to him, this level of accessibility could lead to widespread acceptance of digital assets such as Bitcoin and support their prices.
In the midst of these debates, the point Ju makes is important. The accessibility created through ETFs can have a significant impact on financial markets. According to Ju, this level of accessibility can be described as “as important as the M2 money supply.” This could increase investors’ interest in Bitcoin and support the price of the asset.
Rally Continues in Bitcoin Price
Bitcoin is trading at $66,758 at the time of writing and is up 44.39% since the spot BTC ETF was approved by the United States Securities and Exchange Commission (SEC) on January 11. However, supply shortage, which is one of the main dynamics behind this increase, stands out as a serious issue in the cryptocurrency world.
The supply constraint on the spot Bitcoin ETF product is quite evident. While an average of 900 BTC is produced through mining every day, an average of 10,000 BTC is accumulated by all issuers. This shows that Bitcoin is a limited asset in the market and prices rise as demand increases.
This supply-demand imbalance could have a significant impact on Bitcoin’s future prices. Especially if this trend continues and is supported by the upcoming Bitcoin halving event, prices could rise significantly. Bitcoin halving event means block rewards are halved, which causes supply to decrease, supporting prices.
You can follow the current price movement here.
Source : the crypto basic