FED Chair: Bitcoin can Replace Gold, not the USD or Fiat
Jerome Powell, the U.S. Federal Reserve chair, while speaking at an event held by the Bank of International Settlement (BIS), said Bitcoin could replace gold but fiat. He, however, notes that Bitcoin is volatile and consumes enormous amounts of energy through mining. His comparison of gold to Bitcoin remains consistent despite the yellow metal's go ahead as one of the widely adopted assets, boosts the digital gold. BTC is less than 12 years old but is disruptive, causing changes of definition to what constitutes a preserving asset.
Bitcoin, according to proponents, is designed to eventually replace gold as a store-of-value. Its limited supply, decentralization, and primarily digital existence give the asset an edge over competing alternatives. Therefore, while Jerome's comments are consistent, evidence shows that Bitcoin's volatility is low, comparable to some stock market products and even fiat. Bitcoin's market cap is almost an eighth of gold's at over $7 trillion at spot rates.
Impact on BTC Price:
Neutral. The BTC/USD price is under pressure, dropping on the last trading days on strengthening greenback. Jerome's comments, nonetheless, builds a case for BTC as a valid, supported store-of-value with superior features that gold.
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