As cryptocurrencies have grown popular over the past year, researchers have noticed an inverse relationship between gold and bitcoin markets. Over the past two weeks, as cryptocurrency markets have slumped, financial analysts are reporting even more data about the correlation between both assets.
Researchers and Gold Dealers Believe That When Bitcoin Prices Recently Dropped In Value Investors Rushed Towards Gold
Financial executives and researchers believe bitcoin and gold have an interesting relationship. Over the past year, cryptocurrencies spiked while gold markets slumped, and when gold prices jumped, digital assets dropped in value. Analysts have seen the inverse relationship more clearly over the past two weeks, when the bitcoin market had its most significant drop in value since January of 2017. For instance, Daniel Marburger, the director at precious metals firm Coininvest, detailed in an interview that on January 16 he sold 30 kilograms of gold for bitcoin.
Payment processor Stripe is halting bitcoin support. Declaring that “there are fewer and fewer use cases for which accepting or paying with Bitcoin makes sense,” the online payments specialist is calling it a day on cryptocurrency for the time being. Over the past month, a handful of other companies have also rolled back bitcoin support, usually citing high fees which make micropayments impractical.
Bitcoin Gets the Boot
Stripe is a $9 billion company run by Irish siblings and youthful entrepreneurs Patrick and John Collison. Stripe had been very receptive to cryptocurrency, and were it not for rising transaction fees, bitcoin would still be very much part of its plans. In a blog post published on Tuesday, project manager Tom Karlo explained the reasons for the volte-face: