Cryptocurrency is now preferred over gold by most fund managers and institutional investors as it is seen to be a better store of value and a better inflation hedge. A growing number of fund managers and investors choose Bitcoin rather than gold.
Global investment bank JPMorgan said in October that, institutional investors have been dumping gold for bitcoin. “Institutional investors appear to be returning to bitcoin perhaps seeing it as a better inflation hedge than gold,” the firm’s analysts described.
CEO of Galaxy Digital Holdings, Mike Novogratz, during his company’s Q3 earnings call last week, talked about bitcoin being a better store of value than gold. While stating, “I still think gold was probably an okay asset to own in this environment,” he emphasized that “It’s just gotten crushed by bitcoin.”
Bitcoin is just a better version of a store value and it’s being accepted at an accelerating pace … There are now over two hundred million people around the world that participate in the bitcoin ecosystem, and it continues to grow. he added.
Paul Tudor Jones, the founder of asset management firm Tudor Investment Corp., has also said that he prefers bitcoin as a hedge against inflation in the current economic environment, saying
Clearly, there’s a place for crypto. Clearly, it’s winning the race against gold at the moment … It would be my preferred one over gold at the moment
In September, the pro-bitcoin Nasdaq-listed company Microstrategy said it avoided “a multi-billion dollar mistake” by choosing bitcoin over gold last year. The company now hodls about 114,042 BTC. CEO Michael Saylor said last week that he expects bitcoin to become a $100 trillion asset class.
“It’s pretty clear that bitcoin is winning, gold is losing … and it’s going to continue … It’s pretty clear digital gold is going to replace gold this decade,” Saylor opined.
However, Milling-Stanley, chief gold strategist at State Street’s SPDR ETFs, also has said that, “The historical promise of gold to investors has always been twofold: one, that over the long term — and I stress this, over the long term — gold can improve your returns and it can also help to reduce your volatility,” While gold has a track record of improving risk-adjusted returns over longer time periods — “the holy grail of any asset allocator” — digital coins carry more risk, increasing volatility and making returns subject to their often-drastic short-term swings”. That’s why lasting inflation will likely draw gold back into favor, he added.