Bitcoin’s price has soared since the March rout in global capital markets, outpacing gains in equities and precious metals amid a flood of liquidity unleashed by central banks to combat the coronavirus pandemic, as enthusiasts test the cryptocurrency’s claim to be a safe haven asset. Over the weekend, the oldest of the cryptocurrencies broke through US$10,000, a level that had eluded it for much of the past two months. Since the worst of the market sell-off triggered by the coronavirus in March, bitcoin has more than doubled, reaching US$10,988 on Tuesday. That compared with a 44.8 per cent gain in the S&P 500, and 32 per cent in spot gold.. Its resurgence has come alongside that of spot gold, which reached an all-time high of US$1,939.49 per troy ounce on Tuesday, as investors sought out safe haven assets. Deteriorating relations between the US and China have clouded the economic outlook further as the world grapples to get Covid-19 under control. “If gold surges beyond US$1,900 on the basis of dollar weakness, bitcoin could tag along. This will be driven by investors who see the US dollar depreciating further, potentially eroding its role as the world’s reserve currency,” said Stephen Innes, Asia-Pacific market strategist for foreign exchange trading platform AXI Trader based in Bangkok. The dollar index, which measures the currency against a basket of trading peers, fell as much as 0.5 per cent on Monday to its lowest level since July 2018. The dollar weakness has come amid renewed tension between the US and China, after Beijing on Monday took over the US consulate in Chengdu after ordering the facility to close in a tit-for-tat battle following last week’s forced closure of the Chinese consulate in Houston. That has compounded investors’ concerns about the outlook for the global economy, which is forecast by the International Monetary Fund to contract by 4.9 per cent this year. A weakening dollar could prompt investors to search for other safe haven assets. Some cryptocurrency advocates have called bitcoin the new gold, after seeing periods in which the two had moved in tandem. For example, i n July last year , both bitcoin and gold staged a brief rally in near lockstep as the digital currency came close to a year-high at around US$10,568 and spot gold hit a six-year high. As global central banks slash interest rates and unleash an unprecedented amount of liquidity, estimated at US$6 trillion by Fitch Ratings, this new liquidity intended for rescuing the global economy has also stoked fears of inflation – benefiting both gold and bitcoin, according to Patrick Heusser, senior trader at Crypto Broker, based in Zurich. “The potential for price increase among commodities, such as gold and bitcoin, will rise as investors increasingly see them as a store of value if inflation rises to levels above 4-5 per cent, and believe that inflation is here to stay,” said Heusser, who was a senior interest rate and commodity trader at UBS before joining the cryptocurrency asset start-up. He said that over the next few months, if bitcoin is able to break through the US$10,500 it could rise further to US$13,000.