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It’s been an exciting few weeks in the cryptocurrency market. Bitcoin has finally eclipsed the elusive $35,000 per token mark and Ethereum is above $1,800 for the first time since August.
The rally in the cryptocurrency market follows major hard fork and halving events on the Ethereum and Bitcoin blockchains, respectively. However, the Fed’s dovish turn on interest rates has only added momentum to their rallies. While many investors worry about the cryptocurrency market’s viability in a low-liquidity economy, the prospect of falling interest rates help quell these concerns.
And we haven’t even touched on gold, which is currently hovering around $2,000 per ounce—a price point we haven’t seen since the spring.
Market Snapshot: November 1, 2023
- Inflation Rate: 3.7%
- Fed Rate: 5.33%
- Gold Price: $1,993/oz.
- Silver Price: $22.84/oz.
- Bitcoin Price: $34,809/oz.
- Ethereum Price: $1,815/oz.
Meanwhile, the stock market is down on the month. With the outbreak of war in the Middle East and concerns mounting about a broader regional war, institutional capital is keeping a close eye on gold and other safe-haven assets.
In fact, one industry analyst with Swiss Asia Capital predicts that gold could reach as high as $4,000 per ounce (a +100% increase from current prices) if a larger regional war breaks out.
Whether the Israel-Hamas war will be contained to the Gaza Strip is still a matter of debate. However, there is little doubt that future ground operations could disrupt global markets and curtail the delivery of crude oil in and out of the region.
Should this potentiality materialize, we could see unprecedented levels of capital flight from risk assets into physical assets such as gold and silver as investors move to protect their wealth. Numerous historical examples from the Cold War to the Gulf War to the Iraq War all suggest that gold prices increase during times of war and international conflict.
Geopolitical risk, stagnant inflation, and an uncertain interest rate environment have made investors wary of stocks and other risk assets in recent weeks. In turn, more investors are seeking the relative safety of physical assets such as precious metals.
To capitalize on rising gold prices and a cryptocurrency market with a lot of momentum behind it, consider opening a self-directed IRA with one of the best alternative IRA providers in America. These companies provide full-service IRAs specialized in holding gold, silver, Bitcoin, and other alternative assets within a tax-sheltered environment.
Liam Hunt, M.A., is a financial writer covering global markets, monetary policy, retirement savings, and millennial investing. His commentary and analysis have been featured in the New York Post, Reader's Digest, Fox Business, and Forbes.
