by NADEEM BADSHAH
SHREWD Asian families are planning to buy more jewellery and gold this year after the collapse of virtual currency bitcoin, experts claim.
Europe’s traders have reported a fivefold increase in demand for the precious metal from people wanting to exchange bitcoin as its value plunged.
Bitcoin, launched in 2009, allows people to transfer money using an online wallet on their computer or mobile phone.
The value of the world’s most popular cryptocurrency plummeted by 40 per cent in January after a digital currency exchange in South Korea collapsed, claiming that hackers had stolen some of its assets.
Analysts believe it will now be a golden year for families buying rings, necklaces and
bangles for weddings and as investments.
Jaspal Minhas, from The Leicester and Leicestershire Enterprise Partnership, told Eastern Eye: “The advantage you have got with property and gold is that you can easily pass it on to your family and sell it quickly whenever you want to raise cash.
“Not many people understand bitcoin and don’t know much about it. Also, with virtual money it seems it’s not easy to get your money when you want to exit.
“A lot of people I have spoken to are happy to invest in something they can feel and see like property, gold, jewellery and investments like that.”
One investor sold 30kg of gold worth about £1 million to bitcoin investors as the currency fell 23 per cent last month.
It has led to experts raising questions over whether digital currencies have a longterm
future.
Dennis de Jong, managing director at online trading broker UFX.com, told Eastern Eye: “While bitcoin investors are yet to hit the panic button, the cryptocurrency, fuelled by a crackdown in South Korea, is now struggling to hold its head above the $10,000 (£7,068) mark.
“Meanwhile, good old gold hit a threemonth high last month and, despite losing some of its shine since, the brokers’ phones will have been ringing off the hook.
“Unlike gold, Bitcoin still may have the potential to collapse sharply, which could spell huge losses for many. While you might not get rich overnight by investing in gold, the price of precious metals has risen steadily over the last decade and is a far safer investment than Bitcoin.”
Naveed*, 56, buys jewellery as an investment. The mother of two, from London, said: “Gold is a reliable investment for the future, like property, as the value keeps going up. It can be passed down generations during weddings.”
“Gold is a safer bet than currency as the value does not go down and you have coins, 22 carat jewellery, gold biscuits or 24 carat bars,” she added.
*Name has been changed
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South Africa’s president Cyril Ramaphosa, Brazil’s president Luiz Inacio Lula da Silva, Modi and China’s premier Li Qiang at the Brics summit last Sunday (6)
