BNY Mellon Values BTC Compared To Gold To Determine Its Value: Analysis

BNY Mellon values BTC on par with Gold in order to determine its value and compared its characteristics as well so let’s read more in our latest Bitcoin news today.

One of the oldest institutions in the United States Bank of New York Mellon or shortly, BNY Mellon values BTC compared to gold and claimed that the cryptocurrency became a widely accepted asset, choosing to get ahead in innovation. Now, BNY Mellon published a valuation on BTC comparing the gold characteristics to the cryptocurrency while trying to determine its value. The BNY Mellon analysts recognized the unique properties of BTC and how hard it is to calculate the value when using metrics that are applied to national currencies:

“it should be considered as part of the valuation mosaic. At the beginning of May 2020, a single Bitcoin was worth roughly $8,8001 and the total market value of all Bitcoin was worth $160 billion2, accounting for 0.4% of total global currencies. At current rates, if Bitcoin replaced 5% of the world’s currency it would yield over $100,000/Bitcoin.”

When comparing Bitcoin’s and gold valuation, BNY Mellon analysts referred to the Stock to Flow model that was created by Plan B and acknowledged that this model has plenty of flaws but also see it as an elegant tool with an established gold market framework:

“The implication from this model is that as Bitcoin gains more mainstream momentum and is viewed more like gold, the scarcity value (as measured by S2F) and subsequent halving will ultimately drive prices to the gold dot cluster and implied total market value”

Many households now have an extra buffer of income to spend, due to new stimulus checks and decreased spending during lockdowns.

Will they invest this into markets or pay off debt?#Bitcoin's April performance will depend on it. https://t.co/UJdLxnfqva pic.twitter.com/xXbEICPjqM

— Jan & Yann (@Negentropic_) March 28, 2021

The report claimed that the valuation is more “art than science” and outlined that all models have to reach the BTC fair price which means it is going to be a constantly evolving work. BTC was trading at ,420 and retook another important support zone while in the past 24-hours we can see BTC moving sideways but holding on a bullish trend in the 30-day chart marking 17.
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8% gains. Over the past few weeks, the price action has largely determined by large investors and as indicated by Lex Moskovski, the number of BTC whales is holding around 1000 BTC which dropped to the trend line and peaked once the sell-off started. Moskovski noted:

“However, the price has risen since the start of the dump. This is bullish and also benefits decentralization. Text-book consolidation.”