Only 21 million Bitcoins can be mined and about 90% of them are already in circulation. Given the similarities, some market observers expect the cryptocurrency to behave the way gold does — retaining or increasing in value during times of market turbulence.
Despite claims that Bitcoin is the digital equivalent of gold over the past decade, the correlation between the two assets are growing weaker in recent years, says DBS forex exchange and credit strategist Chang Wei Liang.
Bitcoin, the most famous cryptocurrency and the largest by market capitalisation at around US$558 billion ($750 billion), has been compared with gold as the two assets bear some similarities, particularly in how they can be obtained through mining and their limited availability. Additionally, both are forms of currencies as well as a store of value against fiat currencies that are easily transferable.
