With a finite supply of 21 million coins, Bitcoin (BTC) is considered a great hedging tool against inflationary assets. The decentralised currency remains untouched by the effects of monetary and fiscal policies that impact fiat markets, making it a great way to diversify portfolios.

The lustrous yellow metal has been reaching new highs in 2020. From the lows of March 2020, gold prices have increased 37%, touching the $2,000 mark on August 2, 2020.

Till very recently, synthetic forex pairs have been traded by financial institutions, to deal with currency pairs that do not have sufficient liquidity to execute high volume orders.

Economic uncertainties and market volatility, due to the ongoing pandemic, have led to a remarkable year for cryptocurrencies. Bitcoin (BTC) has especially had a remarkable journey so far in 2020, with an increase in value of more than 60% till August.

With a total market cap of $364 billion and over 6000 tokens and coins, as of August 25, 2020, the cryptocurrency market is a unique global financial market. Cryptocurrencies are decentralised, making them free from the political and economic factors that impact traditional fiat assets.

The 2020 global pandemic has brought a surge in the appetite for cryptocurrency trading. Although a liquidity crisis, in the initial months of the market crash, had led to price declines across major crypto assets, in essence, cryptocurrencies have low correlation to traditional and alternative asset classes, making it the essential portfolio diversifier.

Many traders understand that highly volatile assets like cryptocurrencies come with greater opportunities but also greater risk. However, volatility isn’t the only risk traders of digital currencies need to consider.