It’s been reported by some analysts that bitcoin demand is likely to go up in the coming weeks due to the current economic and market conditions, though some sources claim the opposite, and believe there will be a stronger desire for traditional financial services and institutions.

Some Want Tradition Over Bitcoin

During the last few weeks, several traders sold off their bitcoin and crypto stashes along with their stocks, metals and other assets as a means of attaining cash. During times of economic strife, cash tends to be king, while any speculative assets aren’t set to accomplish much.

One source suggests, for example, that the demand for gold is now jumping given that the asset is often considered a “safe haven” investment for traders. Gold is widely believed to remain strong during hard times, and less likely to lose mass amounts of its value.

This hypothesis has been put to the test in recent days, however, as the price of one ounce of gold has fallen from about $1,700 to roughly $1,300 at the time of writing due to growing fear and panic surrounding the coronavirus.

Still, individuals such as Roy Sebag – the founder of precious metals custody firm Gold Money – believes that investors are putting more money than ever into gold. He explains:

Gold price and flow are determined by the real rate of interest. The [U.S.] Federal Reserve completely changed the rules. The real rate of interest [including inflation] swung even more into the negative, and so we are seeing all that savings flow into gold immediately… Traders are looking for small denominations of gold, which are becoming more and more difficult to find.

Yoni Assia – the CEO of cryptocurrency exchange e-Toro – is one of those who believes gold is likely to attract more investors over the coming weeks, along with commodities like oil, which is suffering heavily at press time at a measly $21 per barrel (it was trading at $34 per barrel in early March). In a statement, Assia commented:

The Saudi-Russia-U.S. competition on lowering the price of oil has added a lot of fire… some days [oil] is now the most traded asset on e-Toro. There’s been a significant squeeze on the ability to purchase dollars… There are liquidity issues, but we’re still not at the point of 2008.

And, of course, there’s always the notion of central bank-issued digital currencies (DBDCs), which at press time, appear to be more popular than ever given the global market conditions. Some analysts believe this is the perfect time for nations like China to issue assets like the digital yuan, which it’s been touting since 2019.

Is Now the Time for the Digital Yuan?

Michael Sung – a professor at Shanghai’s Fudan University – describes the digital yuan as a “stimulus,” claiming:

The [Chinese] government has already indicated digital currency is not meant to do large settlements.

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