Jeff Fawkes is a seasoned investment professional and a crypto analyst. He has a dual degree in Business Administration and Creative Writing and is passionate when it comes to how technology impacts our society.
Bitcoin and Ethereum are two of the most famous cryptocurrencies. During the fall of the markets, they fall especially loudly. Is this the ‘store of value’ power we’ve been hearing about for years? But only oil perform worse these days.
Since the beginning of the global coronavirus pandemic, world markets kept falling into the abyss. Many people start thinking about the true value of Bitcoin, Ethereum, crude oil, futures, and stocks. The Block analyst and notable crypto observer Larry Chermak is publishing interesting stats. Per the numbers, Bitcoin and Ethereum are the two most volatile assets out there, if we don’t count crude oil. Both coins lost a significant portion of the value during the global panic:
Biotechnology was the best-performing investment sector, followed by consumer staple firms, gold-mining firms and health-care providers, food and beverage companies, and medical device manufacturers. Worst performers were energy and finance sectors pic.twitter.com/4QBymImkpX
— Larry Cermak (@lawmaster) March 30, 2020
We see that commodities, ETF equities, and indexes are outperforming cryptocurrencies. The world slowly realizes that China is not just the country of Jackie Chan, Shaolin, and Mandarin, but the important economic circuit of overall stability. Since the supply chains stuck and banks are printing money, cryptocurrencies are believed to gain at the price and strengthen their power.
However, Larry notices that most performing assets are stocks of medical industries, consumer staples business, healthcare machinery producers, and gold-mining companies.
Bitcoin and Ethereum: Worst Performing Assets Since February
Bitcoin maximalists always hypnotized people with the usual claim about ‘safe haven’ when it came to the causa of slow transactions. They say that Bitcoin is not about sending fast transactions, but about storing the value, because ‘Bitcoin is digital gold’. However, Bitcoin lost 35%, and Ethereum lost 50% during the first half of Q1 2020.
This is something else than the store of value because gold is the real store of value and it gained 0,3% over the same time frame. Interestingly, Bitcoin maximalists love to compare Bitcoin to gold, make jokes and memes about persons like Peter Schiff and more. Now, it seems like they have nothing to say, as cryptocurrencies are falling in a very quick manner.
Notably, gold is the only asset that has a price gain, and the market is more alive than ever. Gold bugs are buying and selling gold actively. The volatility of gold becomes even more attractive.
Oil Losing Price Means World Ready for Tesla?
Per the graph with data from Factset, oil lost 62% of its value due to the political uncertainties and tensions between China, Saudi Arabia, the U.S., and Russia. During the last OPEC meeting, instead of decreasing the oil extraction cap for the next period, they have disabled it. Since tomorrow, many of the world countries will have no burden on how much oil they can extract and sell. The further oil price decrease seems like an obvious outcome.
It will hit the Russian economy, as the local budget is heavily dependent on the oil industry. It will also make the U.S. based extraction ventures unprofitable. And Tesla Inc (NASDAQ: TSLA) stocks are keeping a good pace, despite serious losses, it is gaining even during coronavirus fears. You don’t have to be a market expert to notice that the world is slowly shifting to electric vehicles. Now, it’s a fetish, but tomorrow it’s mainstream, and there’s nothing you can do to revert scientific trends. Electricity is just believed to be better than oil, and that’s it.