Bitcoin as a Safe Haven in an Economic Storm
You may have noticed that I have been MIA for the past few weeks, but fear not, I am still hanging around although very busy! It is widely accepted that Satoshi was unhappy with the economic situation at the time centralized financial institutions, bank bail-outs, etc. In a follow-up post, I will discuss what will happen to Cryptocurrencies, as a whole, in such event.
A market crash, and subsequently a financial crisis, occurs when piling on this debt is no longer sustainable and everything comes crumbling down like a house of cards. In order to back this post with facts, I would like to list below the different assets, used in the charts that follow, alongside a brief description and the reason behind their selection. However, not all bonds are made equal. This ETF consists of U. S Treasury Bonds which have a very good credit rating. The 3 charts below with different timeframes , show a snapshot of the asset percentage change over a period of years which I will be referring to in the following sections.
It shares a number of characteristics with gold, such as:. Having the above in mind, one could argue that, Bitcoin could perform, as well as, or even better than gold once we get into murky waters. If I still have your attention, please leave a comment and let me know what else you would like to see me writing about. You can find links to my social media and sign up to my newsletter below.
Disclaimer: All information and data on this blog post is for informational purposes only. My opinions are my own. I do not provide personal investment advice and I am not a qualified licensed investment advisor.
I make no representations as to the accuracy, completeness, suitability, or validity, of any information. I will not be liable for any errors, omissions, or any losses, or damages arising from its display or use. All information is provided as is with no warranties and confers no rights. Ermos Kyriakides ermos. Tweet This. In a financial crisis, asset prices see a steep decline in value, businesses and consumers are unable to pay their debts and financial institutions experience liquidity shortages.
A financial crisis is often associated with a panic or a bank run where investors sell off assets or withdraw money from savings accounts because they fear that the value of those assets will drop if they remain in a financial institution.
A financial crisis can occur if institutions or assets are overvalued, and it can be exacerbated by irrational investor behavior. A rapid string of selloffs can further result in lower asset prices or more savings withdrawals. If left unchecked, a crisis can cause an economy to go into a recession or depression.
Research Data In order to back this post with facts, I would like to list below the different assets, used in the charts that follow, alongside a brief description and the reason behind their selection. Gold quoted in US Dollars, which is the common yardstick for measuring the value of Gold across the world.
The index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of stocks representing all major industries. The index was developed with a base level of 10 for the —43 base period. It has high potential for growth, but also high risk; share value may swing up and down more than that of stock funds that invest in developed countries, including the United States.
Treasury bonds with remaining maturities greater than twenty years. The charts The 3 charts below with different timeframes , show a snapshot of the asset percentage change over a period of years which I will be referring to in the following sections. How many claps does this post deserve? Continue the discussion. Ermos Kyriakides. Ermos Kyriakides Aug Ermos Kyriakides Feb Hackernoon Newsletter curates great stories by real tech professionals Get solid gold sent to your inbox.
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9 Best Bitcoin Stocks You Can Buy and Hold in 2019-20
The American stock market has been on a monstrous rise since before Bitcoin was created, what happens when it crashes? This is a tough question. The crypto and stock market are two different beasts. It is pretty amazing, but everyone from Tony Robbins to Warren Buffet have warned of a major pullback or crash happening soon.
Traditionally August and September are two bad months for the stock market and October has been the month that the largest crashes in history started. How far up will the market go before we see a major sell off? It is over 22, right now which is incredible. The crypto market is an entirely different animal. It is new and doesn't have a track record to follow like the stock market, but it seems almost entirely built on the strength of Bitcoin.
If Bitcoin remains strong, I think the crypto bircoin stays strong. With a strong crypto market, stock investors who are getting nervous about a crash or major pullback might consider investing in crypto what size are physical bitcoins of other commodities or bonds.
With the bond market on shakey ground, gold and silver will still look good, but crypto has to garner some attention. If the crypto market becomes a safe haven for major stock investors during time of uncertainty the we could see some incredible gains if the stock market starts to fall.
I have heard many say that the crypto market is tied to the stock market and that may have been true a year ago or so, but right now, I think the crypto market has at least come into it's own enough to grow independently of the stock market and could see a major spike if stocks fall. That is just my analysis and I'm not a professional financial advisor, just someone who studies the markets and sees real opportunities for all of us involved in crypto. Downvoting a post can decrease pending rewards and make it less visible.
Common reasons:. I think it's likely that the crypto market will i up if the stock market goes. If people are pulling money out of the stock market, they'll want somewhere to put it and I think it's likely a good number of them will choose Bitcoin and other crypto-currencies. But some older people or the people who don't understand much about computer and technology might now want to put money in crypto, so i think those people would choose precious metals. I agree, my point exactly.
I hope that is the case. Thanks for reading. You got a new follower. When stock market crashed in the past, the money went to precious metals. But the last crash wasand there were no cryptos back. I would put money on PM and cryptos for the next crash. I have a hard time explaining cryptos to happenns i know, and most of people still don't own any. When a crash happen it's unlikely those people would run to cryptos, so might be precious metals.
Yes and no. See more would have been created bitcoiin at some point, but the timing seems fortuitous. Since it's creation the stock market has gone up from the lows of the crash. Bitcoin's price has moved independently since according to charts.
Great article. This is the big question for any crypto investor in my opinion, can crypto thrive as the traditional market bubble pops. I think it depends on how severe this upcoming market crash is and there's a very wide spectrum of views on. Crypto has gotten to a point where it's probably a great alternative to the usual rush to gold when the stock market crashes. I'd say people might look into crypto more if the market does take a nosedive I think it already is a safe haven for many of us involved in it.
I'm new to crypto but I'm keepin craxhes Steem. If anybody thinks this stock market isn't juiced to the gills right now I want whatever drugs they're takin! I have recently liquidated much of my stock portfolio, partly to buy more rental property and partly to invest in crypto.
I also plan to borrow from my k for a rental property. Lastly, I am looking into whether I can buy crypto in another of my ks. Frashes am hoping this will be enough of a hedge as I still have two large retirement accounts in stocks and bonds.
Common nitcoin Disagreement on rewards Fraud or plagiarism Hate speech or trolling Miscategorized content or spam. Authors get paid when people like you upvote their post. Sign up. No clue. Bitcoin emerged inso it is kinda related to the financial disaster, right? Only time will tell though No one knows, but: precious metals also rose. I would bet cryptos will rise .
Stock Market Crash 2019? Bitcoin Effect
When Will the Last Bitcoin be Mined?
This is a great benefit because it keeps your investment safe in cases such as bank failures. A financial crisis is often associated with a panic or a bank run where investors sell ir assets or withdraw money from savings accounts because they fear mafket the value mrket those assets will drop if they remain in a financial institution. The same is true for the popularity of cryptocurrencies as. There is also another option to identify specific coins for specific transactions but that requires meticulous documentation. See accompanying chart. Bitcoin is viewed by some as the next currency of value, due to a few advantages over old-fashioned cash. Some of the best examples are Dish and Dell that brought bitcoin transactions into the spotlight. That crisis occurred due to the confluence of a complex cocktail of factors. Putting aside the significant growth in value Bitcoin has experienced this year, there are still bittcoin valid indicators that suggest crypto is here to stay. CryptoSpace 1 year ago. That brings us to the all-important question. It is always good to know whether government is in favor of your business or not. More and more countries e. Of course, there are no guarantees and our views are biased since we are Crypto fans and we will have to wait and see to be proven right or wrong.