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The spring season is in full swing and, with the cold weather having thawed, perhaps the dreaded Crypto Winter has as well. After BTC started the year around the US$16,000 mark, it is now steadily trading above US$28,000—a price level that it has maintained for over a month.
While it remains uncertain how Bitcoin will respond to upcoming market changes, its year-to-date performance is a strong indicator that public sentiment is warming to the digital currency.
But, for now, let’s zoom out and check out the “Market Snapshot” for May.
Market Snapshot: May 1, 2023
- Inflation Rate: 5.0%
- Fed Rate: 4.75% to 5.00%
- Gold Price: US$1,992
- Silver Price: US$25.42/oz.
- Bitcoin Price: US$28,526
- Ethereum Price: US$1,845
The most notable change in the alternative asset market over the past 30-day period is silver, which saw over 4.5% growth over the past month. By comparison, the price of gold more or less stagnated around the US$2,000 per ounce mark for the duration of April.
But perhaps change isn’t the important story this month. Rather, April was a month marked by rare stability. While the past few years have seen large and irregular ups and downs in asset prices, the past 30-day period saw all key alternative assets hold their value or appreciate.
With the next Federal Open Market Committee (FOMC) meeting scheduled to take place later this week, some of that stability may be temporarily put on hold.
With an expected 25 basis-point hike on the horizon, we could see gold and other non-yielding assets set back while the U.S. dollar strengthens in the short run. However, any future rate cuts later in the year will likely see the opposite effect take form.
As for now, cryptocurrency markets seem primed for longer-term growth as the top two tokens by market cap—Bitcoin and Ether—have seen slow and steady price stabilization since the beginning of the year. Should interest rates lower by year-end, we could see consumer demand for digital assets increase, with price increases to match.
In most cases, however, the superior strategy isn’t to pick and choose between alternative assets, but to decide what amount of each you want to invest in. A well-diversified investment portfolio—with holdings in crypto, precious metals, and traditional stocks—can protect your wealth from adverse market events while capturing the high upside potential of these assets.
No matter what the future holds, you may want to consider diversifying your retirement portfolio. If you’re interested in taking a position in alternative assets like gold, silver, or crypto, open a new self-directed IRA with one of our top-ranked precious metals IRA providers.
Mark Turner is an author and editor at Sophisticated Investor. He has over two decades of experience in the financial industry as a broker in both Chicago and New York and has written for several top tier publications. He currently covers the topics of alternative investments, geopolitical events, US economy, portfolio diversification and others.
