Wild swings in cryptocurrencies will eventually drive bitcoin investors to return to gold, says the executive chairman of gold mining firm Evolution Mining. Jake Klein said bitcoin still has a “long way to go” before it demonstrates the kind of “longevity and security” that gold has proven to offer investors over the last 70 years.
Cryptocurrencies are “running a massive amount of speculative money,” he told CNBC’s “Squawk Box Asia” on Thursday. “I think that the volatility in the crypto space is going to ultimately lead to people coming back to gold,” Klein said.
Gold prices fell last week, and analysts say they will likely drop further. Hedge fund manager David Neuhauser told CNBC earlier this week that the decline in gold prices is a “massive buying opportunity” for investors now. Still, Klein said the two can coexist — there are opportunities for gold to “sit alongside” bitcoin, as opposed to bitcoin posing a threat to the precious metal.
Bullish investors view bitcoin as digital gold and a hedge against inflation, expecting the cryptocurrency to appreciate over time. American investor Tyler Winklevoss, who founded Winklevoss Capital Management as well as Gemini cryptocurrency exchange, said last year that “bitcoin is gold 2.0” — and that it will disrupt gold. Billionaire investor Kevin O’Leary said in April that “bitcoin will always be the ‘gold.’ Ethereum will always be the ‘silver.’”
Source: FXPro