The recent mining in Cape Town was interesting to hear from gold miners debating the value of Bitcoin versus gold as a source of value in Indaba.
The controversy erupted when Stablecoin Terra USD crashed, dragging the rest of the crypto with it and erasing more than $ 200 billion in crypto value in less than a day.
Read: Terra didn’t kill Crypto, but it was a narrow escape
Listen to Ciaran Ryan’s interview with Richard de Susa, CEO of AltCoinTrader, and see what happens next:
Following tech stocks, Nasdaq is now down 25% since the beginning of 2022.
In all of this the gold needle has moved, as the price of the metal was stubbornly sticking to its support level around 8 1,820 / oz.
Last week, Bitcoin registered a 55% pullback from its November 2021 high above $ 67,000 before recovering some of its losses.
A good store for gold prices?
“Maybe I don’t understand crypto, but I see gold as a good value for money [than Bitcoin]Clive Johnson, CEO of B2Gold, said Canadian miners produce about one million ounces a year.
Sebastien de Montesas, CEO of Endeavor Mining, which operates in Senegal, C ডিte d’Ivoire and Burkina Faso, added, “Gold is the right element to protect resources.”
What is needed is crypto supported by gold, he added.
Some of these are already on the market, the largest being Pax Gold (PAXG), which is supported entirely by physical gold. Another is Tether Gold.
Both allow investors to purchase a digital stablecoin backed by physical metal without incurring the hassle and expense of savings and insurance.
While TerraUSD was busy evaporating in thin air, gold miners discussed the opportunity to view a different type of stablecoin or crypto.
Time for change?
“No one believes in the current global reserve currency [the US dollar]Mark Bristow, CEO of Barrick Gold, is the world’s second-largest gold producer “We are in a bubble zone, when every TV presenter is trying to explain it to you [asset] Prices can only go higher. We need a different currency and a different global agreement. ”
Read: Rising Dollars Stir in 1980’s Plaza Accord Market
Bristow praised the World Gold Council for its efforts to make gold fully fungible (more standardized and exchangeable). “A transparent, regulated free market will take gold to a new level,” Bristo added
Commenting on the collapse of TerraUSD Stablecoins, Bristow said that the legitimacy of Stablecoins is so weak that they are trying to replace it like Fiat currency.
In March, the London Bullion Market Association and the World Gold Council announced that they were cooperating to develop and implement an international system of integrity of gold bars, chains of custody and Provence. Using two distributed ledgers, the goal of the collaboration was to track the time of purchase and sale of gold bars, verifying their source from mine to vault.
This is no different from the Kimberley Diamond Certification process, which is set up to eliminate blood diamonds.
Gold vs. Bitcoin
Source: Tradingview (Bitcoin – Blue; Gold – Yellow)
John Mulligan, director of market relations and climate change leadership at the World Gold Council, told Indaba that the 34% increase in gold demand in the first quarter of 2022 was due to rising inflation and the war in Ukraine. “Institutional demand has come. Roar back, “Mulligan said.” The ETF helped [exchange-traded fund] Demand and the Russian war. ”
Gold ETFs had their strongest quarterly flow since Q3 2020, due to the need for safe haven. Holdings increased 269 tons, more than reversing the annual net outflow of 174 tons from 2021.
Bar and coin investments fell 20% in Q1, and demand for jewelry was 7% lower than a year earlier, but central banks added 84 tonnes to their global reserves.
B2Gold has reached record highs during the Covid period, but is keeping a close eye on costs, as it is unlikely that gold prices will rise just because inflation is high.
Weak Jewelry and Retail Investment Offset Strong ETF Flows Increase Q1 Gold Demand y / y
Source: Metal Focus, World Gold Council