Wall Street firm Bernstein Research is making the case for Bitcoin (BTC) as a hedge against a potential economic recession and the debasement of the US dollar, according to a CNBC report.
The report cites Bernstein Research’s analysts, who said that while gold is increasingly becoming attractive, Bitcoin is seeing a lower interest despite offering better returns.
“Despite Bitcoin being the best-performing asset this year (up approximately 71% year-to-date), there is limited belief that this is structurally a new Bitcoin cycle, and that Bitcoin will see fresh allocations.”
According to the report, Bernstein analysts have likened the comparatively lower interest Bitcoin is enjoying vis-à-vis gold to “hating on a faster horse.”
“When there is a massive monetary debasement event, while both Bitcoin and gold rally, Bitcoin outperforms gold.
For example, post-Covid monetary printing, Bitcoin outperformed gold (2.9x over approximately 3.5 years).
In fact, even this year, since the banking crisis fears have escalated, Bitcoin rallied approximately 71% year-to-date versus gold rallying approximately 10% year-to-date.
In our view, liking gold, but not liking Bitcoin is like hating on a faster horse.”
The report comes about a week since the CEO of exchange-traded funds (ETF) giant VanEck, Jan van Eck, predicted that both gold and Bitcoin are set for multi-year bullish runs amid the banking crisis and the possibility of an economic recession. The VanEck CEO says Bitcoin investors view it as a hedge in their investment portfolios.
“It’s [Bitcoin] up like 70% on the year, best-performing asset, again, rewarding the people that own Bitcoin for that thesis of wanting a hedge in their portfolios.”
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