The price of a single bitcoin exceeded the value of an ounce of gold for the first time. On Thursday, bitcoin closed at $1,268 while a troy ounce of gold finished the day at $1,233, the BBC reports.
Many savers and investors who distrust central bank-controlled currencies view gold and/or bitcoin as a hedge against money devaluation and a way of preserving wealth. Recently, many Chinese investors have purchased bitcoin as a hedge against a declining yuan.
Over the last week, Bitcoin has surged to record highs. As of late morning Friday GMT, the popular cryptocurrency is valued at $1,286, according to CoinDesk. Gold is trading at $1,227, according to Gold Price.
Both bitcoin and gold rose in value over the first two months of 2017. The bitcoin price, however, has been subject to high volatility.
A recent bitcoin rally drove the digital currency above its previous record high of $1,165.89, which was set in Nov. 2013. The rally was widely seen as being fuelled by speculation on an upcoming move by the United States Securities and Exchange Commission (SEC).
The SEC is due to rule by March 11 on the proposed creation of the first bitcoin-focused exchange-traded fund (ETF). An ETF is a fund that tracks an index, commodity, bonds or a basket of assets and is traded on a stock exchange.
Market analysts said Bitcoin’s recent rise suggested many speculators are betting the SEC will authorize the creation of the bitcoin-focused ETF. However, some analysts say the odds of the SEC issuing a favorable ruling are low.
Meanwhile, gold fell to a one-week low against the dollar, according to BullionVault. Gold climbed to nearly $1,260 in late February, but then slid. The precious metal has continued to slide in early March, but it is still up about $75 since the beginning of the year.