In recent months, Traditional Assets such as gold, stocks and bonds have been struggling to cope with economic turbulence, an uncertain regulatory environment and low liquidity. As a result, Bitcoin (BTC) has seen a rise in the correlation with gold to the highest level in many years, and has surged 70% so far in 2020. On-chain data suggests an ever-increasing number of long-term investors who recognise Bitcoin's potential as a store of value.

Investors have felt duped by recent financial market events, and the increased correlation between BTC and gold indicates that more and more people are placing value in the asset. Not only has BTC demonstrated its resilience, but it has also outshone traditional safe-haven assets, with gold posting a 10% decline year-to-date. Whilst gold has seen some growth since the March 8 collapse of Silvergate, it has largely failed to act as a true safe haven asset.

At the same time, the correlation between Bitcoin and stocks such as the Nasdaq 100 have decreased this year due to declining market volatility. Major crypto exchange platform Binance's continuing regulatory restrictions have resulted in a reduction in market depth and exacerbated the current low liquidity problem.

Due to the fears of a looming economic crash, the author of Rich Dad Poor Dad (Robert Kiyosaki) has suggested that Bitcoin and other precious metals could be ideal alternatives for alleviating investor losses caused by inflationary pressures. Kiyosaki also highlights Bitcoin's potential to act as a secure store of value and investment.

As both traditional and alternative asset classes exemplify the effects of market imbalances, it is more important than ever for investors to recognise the valuable benefits digital assets can offer- and Bitcoin stands out as one of the most appealing digital store of value solutions.



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