Bitcoin: competitor or complement to gold?

Jamal Bouoiyour (), Refk Selmi and Mark Wohar ()

Economics Bulletin, 2019, vol. 39, issue 1, 186-191

Abstract: This study seeks to address whether Bitcoin ever match or even replace gold as a safe haven. To this end, we use a dynamic Markov-switching copula model to test the complementarity and substitutability among Bitcoin and gold within two risk scenarios (i.e., low- and high-risk regimes). Our results reveal a positive and strong correlation between gold and Bitcoin returns coinciding with specific economic and political events. Gold and Bitcoin benefit from the same economic conditions. This suggests that gold and Bitcoin are likely to be complementary, rather than in competition with each other. Gold could act as a diversifier for investors in digital assets. But the Bitcoin have a lot to teach gold in terms of the efficient transfer of value.

Keywords: Bitcoin; gold; testing for complementarity and substitution; Markov-switching copula model. (search for similar items in EconPapers)
JEL-codes: F3 G1 (search for similar items in EconPapers)
Date: 2019-02-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2019/Volume39/EB-19-V39-I1-P19.pdf (application/pdf)

Related works:
Working Paper: Bitcoin: competitor or complement to gold? (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebl:ecbull:eb-18-00781

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().