Nassim Nicholas Taleb says gold still stands apart as a store of value.
On Aug. 5, the entire crypto market saw a $510-billion drop in total market capitalization amid a marketwide downturn. Following the sell-off, over 60% of the top 50 cryptocurrencies lost all the gains made during 2024, according to CryptoQuant.
Other asset classes bled, too. The S&P 500, an index of large stocks in the United States, fell by more than 5%, and Japan’s Nikkei plunged by around 12%. However, according to CoinMarketCap, BTC’s fall was worse, dropping by some 18% on the day.
Bitcoin performed worse than other assets because it is “a speculative asset that seems to behave like high-price real estate in Manhattan,” existing mainly to “track the stock market,” Taleb claimed. He said gold is a superior store of value because with “a gold chain, if you put it on the ground 10,000 years, it will still be gold.”
Bitcoin is sustained by a global decentralized network of miners estimated to comprise approximately 1 million individuals. It has proven highly resilient since its launch in 2009, but anxieties persist about Bitcoin’s longevity, especially as its fixed supply of mining rewards — 21 million BTC in total — dwindles.
The crash was triggered by the Bank of Japan’s July 31 interest rate hike and a subsequent spike in the price of the yen in currency markets. This drove up costs for foreign borrowers with yen-denominated debt, $2 trillion of which was outstanding just before the crash, according to a report from ING Bank.
It fell especially hard on the crypto market, which collectively borrowed nearly $40 billion to finance risky leveraged trades, according to CoinGlass.
Source: cointelegraph.com
