Bitcoin has existed for more than a decade now and over the years the cryptocurrency has been critiqued by many. Perhaps the most infamous among them is Peter Schiff, the CEO of Euro Pacific Capital. The famed gold bug is well-known for thrashing Bitcoin and is taking a swing at the number one cryptocurrency once again.
Bitcoin hasn’t been able to break the resistance at $9.5k since 25 June and has been flat-lining near the $9000 region for some time now. The cryptocurrency dropped down to $8190 on most major spot and derivatives exchanges this weekend, but bounced back above 9000 and is priced close to the $9200 region at the time of writing.
However, bitcoin skeptic Schiff believes that the cryptocurrency won’t be able to hold the $9000 support region for long and is set for a downfall.
Bitcoin and Gold have both been in a holding pattern for the past two weeks with gold trying to break past $1,800, challenging its 2011 all-time highs. Multiple Gold analysts are expecting a bullish break-out and Schiff has seized the opportunity to express his views on twitter.
Schiff on July 5 started a twitter poll asking his audience to vote on what they think the future holds for both the assets:
Peter Schiff himself expects bitcoin to break below $9000 and gold to break past the resistance, but not everyone was on the same page with him. At the time of writing the poll has almost 10,000 votes, and almost 50% of the respondents believe that both gold and bitcoin are set for an upward rally.
Bull or Bear?
The sentiment of the crypto twitter community isn’t unrealistic as several analysts have highlighted the growing correlation between Bitcoin and Gold. Last month, Bloomberg’s Mike McGlone published a report on this matter stating:
“The same forces buoying gold support Bitcoin, yet the supply of the crypto is more constrained […] Increasing companionship with gold is a Bitcoin-price tailwind, in our view. At the highest-for-longest 52-week correlation and beta ever vs. the metal, the first-born crypto should continue to advance for reasons similar to gold, fueled by unprecedented global central-bank easing.”
With this in mind, Should that correlation still be relevant it can be expected that if Gold breaks out, an upward rally for Bitcoin can also be expected.
On a similar note, a report published by Stack Funds, a digital asset a manager, notes that the second quarter of 2020 has ended quite strongly for bitcoin, with many investors continuing to consolidate and adopt a long-term investment plan.
According to the report, bitcoin has seen a surge in its 90-day active supply in this quarter. The report reads:
“Prior to the 2017 and 2019 bull run, where Bitcoin hit $20,000 and $14,000 highs against the dollar, there was evidence of steep surges in the 90d % active supply […] These occurrences tend to peak for a window of 60 – 90 days, before Bitcoin’s induced price rally is realised.”
The report continued that these surges in active supply are often indicators of a run-up in bitcoin prices as per historical data. Hence, the report notes that an upward rally “could happen sooner rather than later.”