Bitcoin steals gold’s shine as new investing in bullion drops by a fifth

Bitcoin is stealing the spotlight from gold as trading among first-time buyers slid to the lowest point since the metal's price sank in 2015, new data suggests.

Gold trading among existing private investors rebounded as bullion prices steadied in November, but falling interest among new investors caused BullionVault's gold investor index to dip to 53.9 from October's 54.6, with a reading of 50 meaning the number of buyers and sellers were exactly the same.

The number of BullionVault users starting or growing their gold holdings in November around the world was little changed from the month before, down 2.6 per cent from October.

Meanwhile, internet searches for "buy bitcoin" overtook "buy gold" last month as the cryptocurrency shot to $11,000.

"Whether or not bitcoin ever achieves common use as money, the crypto-currency plainly offers investors a hot speculation and not a safe haven right now," said Adrian Ash, director of research at BullionVault, the world's largest online marketplace for physical precious metals.

A JP Morgan note published earlier this month said the coming introduction of bitcoin futures "has the potential to elevate cryptocurrencies to an emerging asset class", joining the likes of gold.

Cboe Global Markts plans to launch bitcoin futures contracts on 10 December while CME Group's will go live on 18 December.

JP Morgan analysts said: "The prospective launch of bitcoin futures contracts by established exchanges in particular has the potential to add legitimacy and thus increase the appeal of the cryptocurrency market to both retail and institutional investors… And this is important for an asset class that derived its value from its breadth of acceptance.

"In other words, the perceived value would rise over time if more people use bitcoin and other cryptocurrencies as a store of wealth and more merchants accept it as a means of payment in exchange for goods or services."

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