Key Points
- JPMorgan states that gold investors aren’t switching to Bitcoin despite its recent hype.
- Interest in both gold and Bitcoin has been observed among institutional investors and individuals.
JPMorgan Chase & Co, a prominent international financial services company, recently disclosed findings that contradict the popular belief that gold investors are turning to Bitcoin (BTC) as an alternative investment. Despite the excitement surrounding Bitcoin’s recent surge, conventional gold investors appear to be standing their ground.
Interest in Gold and Bitcoin Among Investors
According to a research study, JPMorgan has noted that both gold and Bitcoin have been purchased by institutional investors and individuals this year. While some reports suggest that the increase in Bitcoin Exchange-Traded Funds (ETFs) inflows has led some investors to transition from gold to cryptocurrency, JPMorgan disagrees.
Another expert analysis suggests that rather than moving from gold to Bitcoin, private investors and individuals have shown interest in both gold and Bitcoin throughout the year. The bank’s analysis indicates a $7 billion increase in BTC futures and a $30 billion increase in gold futures since February.
Last year, Robert Kiyosaki, a BTC proponent and author of “Rich Dad Poor Dad”, urged investors to bolster their BTC holdings rather than acquire traditional assets. Kiyosaki encouraged his followers to abandon traditional financial systems and turn to alternatives like gold, silver, and cryptocurrency, particularly Bitcoin.
Gold or Bitcoin?
Despite Kiyosaki’s endorsement of these two alternative assets, some preference still exists. Industry figures like Jim Cramer, American television personality, author, and Host of Mad Money on CNBC, see gold as a more attractive option than Bitcoin. In his view, gold is a proven asset class with non-speculative use cases, while Bitcoin is more of a “risky asset”.
This perspective is further reinforced by statements from some Goldman Sachs analysts. These experts asserted that gold is a more effective portfolio diversifier compared to Bitcoin. Furthermore, Frank Holmes, the CEO of US Global Investors, argues that gold is a superior asset to hold compared to Bitcoin in a tense environment and amid war news.
However, Mike Novogratz, the CEO of Galaxy Digital, described the current market level as “frothy”. He noted that Bitcoin is in a price discovery phase with the introduction of ETFs, bringing in a new wave of investors to test the market. He further claimed that the crypto asset will soon surpass gold as the most preferred among investors. This prediction comes despite the significant difference in market capitalization between the two assets.
Experts speculate that the potential of spot Bitcoin ETFs could bridge this market cap difference in the next decade. The projection focuses on the mainstream adoption of Bitcoin, a move that will generate intense demand for the coin. Amid all this, investors are cautioned to take all expert predictions and opinions, including Kiyosaki’s, with a grain of salt.
