As international investors try to read the tea leaves on how deeply the US central bank will cut interest rates , two investment options have been on the rise before this week’s widely expected loosening in monetary policy. The values of gold and cryptocurrency have been surging. The former reached an all-time high of more than $US2500 an ounce this month and Bitcoin is up 33 per cent year to date at around $86,500.
Bitcoin, sometimes referred to as “digital gold”, has risen by a third this year. Credit: Bloomberg Both commodities share similarities. Neither gold nor Bitcoin are used to buy things in shops, so they are impractical for everyday use.
Both are also mined; one in the traditional sense, and the other virtually. Importantly, both are also viewed by some investors as a store of value that is not directly linked to the price of shares or bonds – though whether Bitcoin really is “uncorrelated” is debated. So with gold and Bitcoin both in rude health, which one are young Australians picking up? Investor James Giardinazzo, 26, said the Bitcoin buzz tended to attract young people like himself.
Loading “I won’t lie, the initial attraction was definitely the life-changing gains and the potential shot to be one of the people that gets lucky with a needle in a haystack and make potentially life-changing money in a few months,” Giardinazzo said. But he said once the initial shine had worn off, his ongoing research into the cryptocurrency market – specifica.