The global new crown pneumonia epidemic has changed the consumption concept of many people. In the past, with spare money on hand, everyone would always think about making a travel plan, or changing their mobile phones, but now more and more people are starting to prepare for emergencies. . User portraits with such demands can be summed up in one word: hedging risks.

玩心跳和求避险:数字币与黄金的逻辑差异

Bitcoin prices soaring and slumping

In order to prevent emergencies, taking the year-end bonus for investment is a choice, but what to invest in is a question. Some people will choose to buy a gold bar, but some people will look at the digital cryptocurrency represented by Bitcoin because it claims to be “digital gold.” But is this really the case? The “number” part of the digital currency label may be true, but the “gold” part is not.

Bitcoin has been often tied to gold since its birth in 2009, to gain people’s recognition in the name of “digital gold”. In fact, this can be regarded as a common hot spot marketing strategy. However, what many people did not expect was that, at least in terms of price, Bitcoin was more “valuable” than gold. After all, on March 2, 2017, the price of a bitcoin surpassed the price of an ounce of gold for the first time, and more than three years later, the price of a bitcoin had reached the highest price of more than 30 ounces of gold.

Although gold prices have recorded considerable double-digit gains in the past two years, this is only a fraction of Bitcoin’s gains. Taylor Winklevoss, the founder of the Gemini cryptocurrency exchange and one of the twin brothers of the first cryptocurrency billionaire, even stated that the price of Bitcoin may exceed the $500,000 mark. He believes that Bitcoin will outperform gold. If this happens, the market value of Bitcoin will exceed $9 trillion.

The 9 trillion pie is tempting enough, so it once attracted some funds from the gold field to buy Bitcoin instead. But this is not for hedging, but a choice with high risk appetite. In fact, as a supporter of Bitcoin, it is understandable for those investors to sing more of their assets, but it is an exaggeration to think that Bitcoin will surpass gold. Because the judgment made when Bitcoin rose sharply for the first time and then fell rapidly in 2017 is clearly still valid. Compared with Bitcoin, gold has lower volatility, has a better liquid market, and is in a more mature regulatory framework. Internal transactions.

Bitcoin fans have repeatedly claimed that the biggest difference between this bull market and the previous one is that Bitcoin’s role in investment portfolios is more well-known. Last time it was retail investors who pushed prices up, this time with more institutions participating. But this is a kind of logical sophistry, because as long as there is enough profit, the predators will always come off the market. This is not enough as a basis for this round of rise to be more stable. After all, it caused a major blow to the financial market more than ten years ago. The subprime mortgage crisis began with large financial institutions. Lehman Brothers, the fourth largest investment bank on Wall Street, became a sacrifice, and Bear Stearns was also faltering. It is also worth noting that shortly after those institutions were “sacrificed to heaven” during the crisis, Bitcoin was born, and the price of gold once hit a record high.

After more than ten years of companionship, the development of Bitcoin has exceeded the estimates of optimists. The father of Bitcoin, Satoshi Nakamoto, once said confidently that Bitcoin’s goal is $4,000. And now the speed of Bitcoin’s hurricane has already exceeded the founder’s expectations, and in fact it has exceeded all rational controls.

It is not only the amount of currency issued by the central bank, but also virtual assets. In the past two months, Bitcoin’s rollercoaster-like market is enough to meet all the needs of playing heartbeat. Of the 410 billion US dollars currently used to purchase current bitcoin assets, more than half occurred in the past year, and about a quarter of the US dollars have an average purchase price of less than 36,000 US dollars. This means that unless the price of Bitcoin reaches or exceeds $36,000, most investments are not profitable-and the price of Bitcoin is likely to fall below this price overnight.

People who bought Bitcoin with 10,000 yuan in the middle of last year now have about 25,000 yuan in their account. And the person who spent the same amount of money to buy gold bars is now worth 11,000 yuan. This gap seems to be large, and digital currency is even more attractive, but this attractiveness is dangerous and unstable. After the digital currency bubble ebbs, not only can we see who is swimming naked, but also what kind of safe-haven assets are really strong.

There are underlying logic differences between digital currency and gold investment. Under normal circumstances, there is no overlap between chasing short-term profits and seeking long-term hedging. But under the bewitching of some institutions, something beyond common sense is happening. Institutions charge, are everyone going to keep up? At least from the third quarter to the fourth quarter of 2020, someone has chosen this strategy, and there is indeed an outflow of funds from the gold ETF and transfer to a member of the “coin army”. In addition, the price of gold has entered a period of adjustment when the price of gold has risen and fallen, and the price of Bitcoin has successively hit record highs. During this period, there have been constant voices that Bitcoin will replace gold.

So, is it time to abandon gold and switch to buying Bitcoin? Investors must have their own clear judgments rather than emotional judgments.

In fact, Bitcoin is more like a venture capital, or even a speculative tool. After experiencing several bubble bursts in 2013 and 2018, Bitcoin has indeed proved itself to be an asset that is more durable than many people think, but it is still not an experience compared to gold’s thousands of years of use. What test has been passed. At the moment when central banks of various countries, especially the Federal Reserve, implement the largest quantitative easing policy in history, it has become a trend for investors to look for alternative assets to fiat currencies. As the market’s trust in the U.S. government continues to decline, and a large number of economic stimulus measures are about to be introduced, it is wise for investors to look for assets that can maintain their value to hedge against uncertainties, currency depreciation and inflation risks. This allowed Bitcoin to fly to the sky through this vent, but people who are immersed in the price carnival rarely consider: what should the wind stop, what to do? Of course, many investors do not understand Bitcoin at all and are not worried about this possibility, thinking that one of the most common reasons they buy Bitcoin is that others have also bought it.

For savvy investors who become “others”, Bitcoin’s volatility creates resistance and prevents it from being used for trading. The daily volatility index of Bitcoin calculated based on the closing price of the past 90 days is not only much higher than that of gold, but also higher than that of assets such as the U.S. S&P 500 Index and the U.S. dollar. Bitcoin is too volatile and its value is too easily manipulated, which is destined to be unable to become a real safe-haven asset. Of course, many speculators are attracted by volatility to invest in Bitcoin, which makes Bitcoin’s high price build on the beach.

In contrast, no one doubts that the price of gold will fall to zero, because gold has its physical properties as price support, which makes it have other values ​​besides being a safe-haven asset. However, the intrinsic value of digital currency is limited, and it depends on the ethereal beliefs of its holders and the basic power supply. As central banks continue to develop digital currencies, digital payment systems will become mainstream and open to future technological development. This does not mean that Bitcoin will always dominate: it is only the first, not necessarily the most. The good one.

For investors with higher risk appetite, it is understandable to make a fortune from the digital currency trend. But under normal circumstances, these investors and gold do not overlap, because gold, as a defensive asset, brings a protective effect rather than high returns. The conversion of some highly volatile assets into Bitcoin is consistent with the usual logic, but if digital currency is regarded as a substitute asset for gold, a dangerous resource mismatch will occur.