Precious metals traders in Hong Kong political and protested claim the rich are removing gold from the coast under a new security law Beijing passed in July.
Investors who fear their assets are at risk and need to be kept out of reach are a sign that the rich are ready for the digital age of gold, powered by an emerging new asset called Bitcoin.
Hong Kong FUD urges wealthy individuals to move gold offshore for safety reasons
New laws in Hong Kong imposed by China have pushed the rich to move gold out of the country's financial center and move it to safer havens like Switzerland, Singapore and more.
The trend began last year as protests swept across the nation and political tensions overcame, according to local metal traders.
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The factors encourage investors to move capital to safe havens like gold, silver and, more recently, bitcoin and cryptocurrencies. However, holding precious metals carries risks unrelated to crypto assets, such as: B. Physical theft.
"Investors are moving gold from Hong Kong to Singapore because they don't like the risk and uncertainty," said metals analyst Ronan Manly said FT. "This could raise concerns about the security of bullion and the certainty of property rights, according to gold holders."
For the wealthy who are into security and property rights but want an asset similar to gold, Bitcoin is the answer.
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How Bitcoin is the best insurance policy for political and economic chaos
Bitcoin was developed by Satoshi Nakamoto as a digital peer-to-peer form of cash, but it also has some similarities to gold. Satoshi tried to make the cryptocurrency part a commodity or a "collector's item" and coded a fixed upper limit for the offer of the asset.
Only 21 million BTC will ever exist. Even fewer circulate today, and millions can be lost or locked away for good. There are risks associated with custody of crypto assets, including total loss and the responsibility of having to be your own bank. However, this also means that no third party can ever access the assets without directly having or knowing a private key.
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Digital ownership through cryptography is a secure way to protect property rights. Bitcoin only exists digitally and it lacks a physical form that is endangered by earthly actors such as thieves, family members or the strong arm of the government.
For these reasons, Bitcoin is the ideal solution for the current situation in Hong Kong and shows how ideal the future environment for cryptocurrencies can be. Dollar inflation, the preference for contactless payments and some other sudden changes in the mainstream market could lead to an increase in the use and acceptance of Bitcoin.
Gold shares none of these attributes, but has been used for centuries for the similarities it shares with crypto. In today's digital age, economic uncertainty and political unpredictability, Bitcoin remains the best insurance policy for the future.