Bitcoin Price Surpasses Luxury Watches
If you’ve been considering investing in a luxury timepiece from Rolex or Patek Philippe, you may want to think again. Bitcoin is now fetching more than these high-end watches on the secondary market. While watch sales surged during the pandemic, their prices have dropped significantly due to high interest rates and uncertainty in the economy.
High Supply Levels Affecting Rolex Prices
Prices of the most traded watches have fallen by 42% since April 2022, while Bitcoin has only experienced a 4% decrease during the same period. The surge in demand for watches from top brands during the pandemic has given way to declining enthusiasm due to economic uncertainty.
Uncertainty in prices has increased by 12%, with a 5% rise in used watches on the secondary market. Meanwhile, Bitcoin’s price has increased significantly from August to November.
Bitcoin Outperforms Rolex and Patek Philippe
The surplus supply of watches is causing them to take longer to sell, with price indices for secondary market Rolex and Patek Philippe watches falling in October. As a result, their investment potential is declining due to high interest rates diminishing their value stability.
According to Pierre Dupreelle, managing partner at Boston Consulting Group, while there have been some landings in 2023, overall prices have stayed much higher than pre-pandemic levels. He does not believe it’s a bubble burst but expects prices to stabilize or even rise as the economy stabilizes.
On the other hand, Bitcoin’s prospects are brighter as its price has increased independently of interest rates compared to last year. Its correlation with the stock market has declined substantially since 2022, making it more related to investor sentiment.
Hot Take: Conclusion
In conclusion, if you’re torn between investing in luxury watches and Bitcoin, the latter seems to be outperforming the former. The decline in watch prices is largely attributed to high interest rates and economic uncertainty. On the other hand, Bitcoin’s independent price increase and reduced correlation with stock markets make it a more promising investment option for the future.
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