Gold also posted impressive gains for the year, though they paled in comparison to Bitcoin’s meteoric rise. The yellow metal’s spot price ended the year on a 25% gain.
Bitcoin’s biggest proponents believe the digital currency is eating away at gold’s market cap as investors opt for the efficiency, portability and proven scarcity of the asset. Astonishingly, that view is also shared by JPMorgan Chase analysts, who believe Bitcoin’s digital gold narrative is drawing capital away from precious metals.
Some believe that Bitcoin’s supply squeeze could send prices higher over the course of 2021. As Cointelegraph recently reported, digital asset manager Grayscale bought up nearly three times the BTC mined in December. Demand from PayPal, Cash App and others has also contributed to an apparent supply shortage of BTC.