Renowned financial experts and economists are predicting a weak position for the US dollar, and the gap created by it will be fulfilled by the strong hedge assets such as gold and Bitcoin.
As a result of the weaker US dollar, Bitcoin may get a warm welcome from investors and traders across the world. Due to various factors, including the negative effects of the Coronavirus pandemic, the value of the US dollar has reached a three-year low position against some fiats.
Dollar Currency Index
The expectation of the incoming stimulus package amid the Coronavirus pandemic may pose a great threat to the dollar. The dollar currency index (DXY) has touched the figure of 91.1 on December 1, the lowest level since April 2018. Vice president of trading at Tempus, John Doyle, said,” When you get a report that a bipartisan stimulus deal can get done after hopes have been dashed, it’s just another reason to bid risk up and sell the dollar.”
Peter Schiff, who passed very bad comments for Bitcoin, has admitted the expected downfall of the US dollar. According to him, the dollar is standing at its “lowest level against the Swiss franc since Jan. of 2015.”
He explained that 2021 will prove the worst year for the US dollar, and the condition would remain the same until 2022.
Schiff is a strong supporter of gold and has always favored gold over the world’s leading digital asset. He gave contradictory comments for flagship cryptocurrency even when it reached close to its all-time high above $19,500.
Grayscale, one of the largest crypto asset fund managers, would run add over mainstream TV channels to buy Bitcoin instead of gold. On this news, Schiff protested highly and requested people to shut off their TV channels.
At the start of 2020, the correlation between Bitcoin and gold was surging very high, but the trend faded away after entering into Q4 of 2020. The leading digital currency expressed a growth of 70% in Q4 alone, while on the other hand, the price of gold went low. So, we can say that correlation between both top hedge assets has come to an end.
Crypto-inspired people are predicting high levels for the leading cryptocurrency because the numbers of institutional clients have increased many folds since the beginning of 2020.
But gold-inspired Schiff claimed in his latest tweet that Bitcoin cannot snatch the market cap of gold.