Cryptocurrencies

2021, a golden year? – Cryptocurrencies

While the year 2020, particularly rich in events, is coming to an end, the time has come to take stock and to make projections for 2021. It must be said that few of us could have imagined such a scenario between a global pandemic that is coming to drop all international stock markets, and in return a crazy year for alternative investments: from gold which broke its record in August and tries to come close to it at the end of the year, up to Bitcoin (BTC), king of this year, who will have even managed to make the front page of the biggest newspapers. But in a health and economic context that is still very uncertain, how could the coming year be? Will we still see bullish phenomena for the “non-traditional” economy? Will the printing press of the States continue to run? For this first paper of 2021, I invite you to look together at the bright future of precious metals and the possible gold rush that could continue to occur.

Warning : This article is brought to you by the company Veracash. Crypto investments are risky by nature, do your own research and invest only within the limits of your financial capacity. This article does not constitute an investment invitation.

A brief history of gold through the ages

As we have already explained to you, gold has always been considered a safe haven, incredibly resistant to all the upheavals of international finance and the various forms of crisis that it may exist. Yet some continue to wonder how this is possible?

Can you imagine that Gold is truly the oldest barbarian relic in this world. First, the yellow metal has been a tool of exchange since the dawn of time, and money was historically gold. But also, the price of gold tends to rise as the economy crumbles and interest rates go negative.

Why this phenomenon?

Firstly because gold is a precious metal, and its scarcity allows it to retain a special place with all citizens and, moreover, investors. Also, because doing so increasingly rare, its course increases. You know as well as I do, everything that is rare is expensive, in general. Also, you should know that thegeopolitics greatly influences the price of gold. So over the decades, surprise, the absence of a clear scenario or geopolitical turmoil and lack of confidence in governments have allowed the yellow metal to break its records.

It is also said that Gold is an interesting barometer for judging the health of a government, economy or world politics.

And in this game, it must be said that the situation of recent years has something to favor gold: from geopolitical tensions between the US and China, to Brexit, to the COVID-19 crisis, the world has had its dose of tension and it is not going to stop.

Through the ages, many phenomena have validated this thesis and its positioning as a safe haven. Let’s look at the main events of the last 50 years:

  • From Bretton Woods Agreement (1944), a new international monetary system is created but it is only in 1971 that gold begins to fluctuate freely when the dollar is no longer convertible into gold;
Man showing coins at the time of the bretton woods agreements
  • 1979: The price of gold first jumped in the late 1970s during the invasion of Afghanistan by the USSR. The ounce then exceeded 660 dollars, a record for the time at the dawn of the 1980s;
  • 2000s: The creation of ETFs and the onset of a new financial crisis again produced a rise in the price of gold between 2003 and 2010. At that time, some investors even went so far as to sell their life insurance policies to invest in gold. The price of gold went from $ 261 per ounce in 2001 to $ 1,911 in September 2011, the previous record. It must be said that the safe haven was sailing in particularly cloudy water: 2 consecutive stock market crashes (internet bubble in 2001 and stock market crash in 2008), subprime mortgage crisis, bank failures (RIP Lehman Brothers), inflation, sovereign debt crisis …
  • The year 2020 finally, will mark a new record against a background of trade war between China and the United States and of course the COVID-19 crisis which could deeply upset the global balance.
graph showing the evolution of the price of gold since 2013
Gold price in euros since 2013

2020: a brilliant year for gold

The year 2020 marked a turning point, creating a bullish rally for gold and precious metals in general. In particular caused by the collapse of the financial system due to COVID-19 but also the scarcity of gold which continues to push up the price.

graph showing the price of gold in 2020
Gold price in 2020

The situation even caused Bloomberg to say that gold will continue its bullish rally until 2023, just like silver.

Gold thus surpassed $ 2,000 last August, at the very moment when Bitcoin, too, was gradually reaching its ATH. As if yellow gold and digital gold follow and resemble each other.

The end of 2020 will also have seen a fall in the price of gold, easily explained by two global phenomena: the election of Joe Biden in the USA, which we told you about in a previous article but also the arrival of the vaccine. against COVID-19, which has given investors some enthusiasm to invest in riskier media. However, it should be noted that gold gained 40% during the year 2020, a good performance.

Among the precious metals, silver also emerged as the winner of this year of chaos: it is up 47.5% over the year 2020 and climbs to $ 26 per ounce and takes advantage of the general craze for metals industrial. Many analysts are predicting a two-fold increase in the price of silver by 2023.

graph showing the price of silver in 2020
silver price in 2020

Finally, among the industrial metals that have suffered the full brunt of the slowdown in industrial production across the world and particularly in China, the world’s factory and the cradle of the pandemic, copper in particular has recovered well and presents very good statistics with an increase of 27% over the year. And for once, the red metal follows the same curve as the yellow metal, which was not always the case.

In short, 2020 will undoubtedly have been the year of precious and industrial metals, and more so, the right time to start alternative investments, but what about 2021? Zoom on the main projections!

The outlook for 2021: the gold rush and the breakthrough of silver

Industrial metals

If we look first at the outlook for gold : the old barbarian relic could, Goldman Sachs to exceed $ 2,300 in 2021 and thus quietly continue its bullish rally despite a still unstable economic and political situation. So if Joe Biden continues to push through stimulus measures to help lift the US economy heavily affected by COVID-19. At the same time, the resumption of demand for physical yellow metal could help increase the price of gold, especially in India and China where large traditional buyers like to invest in gold bars especially in times of uncertainty.

Some analysts even say gold could hit as high as $ 3,000, and looking at Bank of America’s forecast, that scenario may well come true.

Some are already on the bridge to enrich their portfolios and diversify their holdings with gold, and sometimes, if you don’t go into precious metals, they come to you! Imagine two cleaners in Brussels stumbling upon gold bars. The gold rush therefore has no limit: these two bars now represent nearly $ 120,000, or approximately € 100,000, enough to end the year on a high note. But this story also shows us, beyond the great discovery, a rather interesting observation: many sewers, especially in Switzerland, are full of gold, and this is not very surprising when you think of the strong jewelry activity, gold companies and the storage of gold in various secret places that let some nuggets escape .

So, according to a study by Eawag, the Swiss water research institute, “about 3,000 kilograms of silver and 43 kilograms of gold end up in the country’s pipelines, or about 2.6 million euros”. Several projects are thus at work to try to recover precious metals of all kinds (gold, silver, copper, etc.) in wastewater treatment plants and thus reintroduce them into the circular economy, a fairly original way of recycling.

As for silver, it should also continue to break through and some analysts believe that its price could rise to around $ 50, thus doubling the stake. As you know, historically, what we call poor man’s gold mechanically follows the curve of gold, allowing us to have a precise view of its behavior over time.

Given the still uncertain context, the unprecedented rise in the price of gold and even more that of Bitcoin, it is a safe bet that the year 2021 will once again mark a boost in the use of investments. alternative. This observation, some made it very early, it is the case of Veracash, the new atypical bank founded by Jean-François Faure, which one does not present any more. Zoom on the user manual Veracash to invest in gold and silver in 2021.

What if this is the time to invest in gold and silver: instructions for use

Man walking on gold
Source: Veracash

Veracash is an atypical new bank that allows you to save and pay thanks to a banking solution outside the traditional system: completely backed by precious metals (gold, silver, diamonds), the HRV is therefore not dependent on Central Banks.

Veracash application
Source: Veracash

All on one application and dematerialized, Veracash therefore allows you to increase your savings in precious metals, which are themselves stored in physical form in the free ports of Geneva, and digitized to allow you to view it in real time, to make them grow and even to spend them thanks to current payments with your Veracash mastercard.

This a little crazy bet, Jean-François Faure thought about it very early on, first with his company aucoffre.com created in the midst of the 2008 financial crisis, then with Veracash.

Its goal ?

Exit traditional channels in order to benefit from safe havens and at the same time offer the same possibilities as a traditional bank. With this value offer, we are finally modernizing the oldest value of all time by digitizing it for everyone.

Veracash is not planning to stop there as 2021 is also a milestone for them: fundraising which should enable them to consolidate their status as atypical neobanks and continue to offer new services.

If you too are convinced that precious metals, especially gold and silver, are relevant alternatives for 2021, do not hesitate to take a look at the platform for alternative investments to become true seasoned investors!

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