Coinspeaker
JPMorgan: Gold Investors Stay Firm amidst Bitcoin Hype
Recent insights from JPMorgan Chase & Co (NYSE: JPM), a leading global financial services firm, revealed evidence to support the notion that gold investors are not flocking to Bitcoin (BTC) as an alternative asset. Despite the buzz surrounding Bitcoin’s rise, traditional gold investors seem to be holding their ground.
Investors and Individuals Have shown Interest in Gold and BTC
As per a research report, JPMorgan mentioned that institutional investors and individuals have been purchasing both gold and Bitcoin this year.
While some reports indicate that the surge in Bitcoin Exchange-Traded Funds (ETFs) inflows has caused some investors to shift from gold into cryptocurrency. However, the financial firm disagrees.
As per the analysis of another expert, instead of switching from gold to Bitcoin, private investors and individuals have shown interest in both gold and bitcoin throughout this year. The bank’s analysis shows a $7 billion build-up in BTC futures and a $30 billion build-up in gold futures since February.
Recall that late last year, BTC proponent and author of “Rich Dad Poor Dad” Robert Kiyosaki encouraged investors to increase their BTC holdings rather than acquire traditional assets. The acclaimed author encouraged his followers to ditch traditional financial systems and pivot to alternatives like gold, silver, and cryptocurrency, particularly Bitcoin.
Bitcoin or Gold?
Between these two alternative assets being touted by Kiyosaki, some level of preference still exists. Industry players like American television personality, author, and Host of Mad Money on CNBC Jim Cramer see gold as a more preferred option to Bitcoin. In his opinion, gold has proven to be an asset class that has non-speculative use cases while BTC is more or less a “risky asset”.
This is further underscored by a statement from some Goldman Sachs analysts. These experts stated that gold is a useful portfolio diversifier compared to Bitcoin. Also, Frank Holmes, the CEO of US Global Investors believes that gold is a better asset to hold when compared to Bitcoin in a high tensioned atmosphere and amid war news.
However, Galaxy Digital CEO Mike Novogratz described the current market level as “frothy.” He noted that BTC is in a price discovery phase with the arrival of the ETFs, bringing in a new army to test the market. He further said the crypto asset will soon overthrow gold to become the most preferred among investors. This projection comes despite the significant difference in market capitalization between the two assets.
Experts believe that with the potential of spot Bitcoin ETFs, this market cap difference might be bridged in the coming decade. The projection centers on the mainstream adoption of Bitcoin, a move that will create an intense demand for the coin. Amidst all these, investors are advised to take all predictions and opinions from experts including that of Kiyosaki with a pinch of salt.
