The price of bitcoin and other cryptocurrencies dropped sharply on the last trading day before the Christmas break – December 22. For some experts and analysts who have been skeptical in the midst of the meteoric September rise, the correction was a long time coming. However, the biggest benefactor appears to have been the spot price of gold and silver.
Bitcoin briefly rose above the $16,000 mark over the long weekend after dropping to as low as $11,000 on December 22. However, bitcoin fell below $15,000 in the early afternoon of December 27 and is now valued below $15,000 as of this writing.
The spot price of gold has climbed over $20 since December 22, seemingly confirming suspicions that bitcoin and other cryptocurrencies have supplanted gold as a speculative asset for some investors. As we enter 2018, regulators are keeping a closer eye on bitcoin and other cryptocurrencies. The incredible rise could be stifled by this new attention, and those who have bought into bitcoin or others looking to turn a profit could head for the exits quickly if the value plunges or even stagnates.
This could be great news for gold. Investors who are skeptical of cryptocurrencies heading into 2018 should take a look at the iShares Gold Trust ETF (NYSE:IAU). The ETF has climbed 11.5% in 2017 and is up 2% week over week as of afternoon trading on December 27.
Gold faced a number of headwinds in 2017 but has still finished in the black. An unregulated market that is attracting more retail investors by the day could produce tremors that would see a flight to precious metals.