The price of gold has set a new all-time high of $1,954 a troy ounce today while volumes for gold-backed cryptocurrency tokens have risen.
In the past month, PMGT, a blockchain-based token issued by commodities digitization company, Infinigold, and backed by bullion held in the Perth Mint, has witnessed a near quadrupling in volume.
“The weekly average volume today is almost four times higher than July 1st—370% higher to be precise,” Jon Deane, CEO Infinigold, told Decrypt.
Other tokens are performing similarly well. Paxos Gold has seen its volumes double in the same time period, with Digix Gold Token and Tether’s gold token both witnessing big increases in volume.
Digital investment platform Uphold CEO JP Thieriot suggested that demand for gold is likely a result of an uptick in unconventional monetary policy.
“The financial markets have been carpet bombed with trillions of dollars of cash, and while this has kept the equity markets, if not the general economy from completely imploding,” “It is not without its (very predictable) consequences,” Thieriot said.
“Gold has just nudged its slumbering little brother, Bitcoin, awake—as it’s now their time to go out and dance and frolic across the landscape,” he added.
While the US has announced further economic stimulus and the price of the US dollar has declined, the prices of gold and Bitcoin have both risen. Gold is up 11% in July, while Bitcoin has shot up 20%.
Bitcoin bull Anthony Pompliano and Gold bug Peter Schiff took part in a debate yesterday, each arguing that their chosen asset was the answer to growing global financial uncertainty. The only thing they agreed on was that the US dollar is potentially falling into an abyss.
But will it be gold or Bitcoin that steps in to fill the gap?