Bitcoin: The New Gold Standard for Economic Downturns?
A recent CNBC report highlights Bernstein Research's argument that Bitcoin (BTC) is an effective hedge against a possible economic downturn and the depreciation of the US dollar.
The financial services firm based on Wall Street suggests that Bitcoin’s better returns generate less interest than gold, which has been gaining popularity.
Although Bitcoin is the best-performing asset this year, with an increase of roughly 70% year-to-date, there are limited beliefs that this is a new cycle for Bitcoin and that fresh allocations are expected.
Bernstein analysts compared Bitcoin’s low interest to “hating on a faster horse” when compared to gold.
The report claims that both Bitcoin and gold perform well during massive monetary debasement events. However, Bitcoin tends to outperform gold during such crises.
For example, after the COVID pandemic resulted in monetary printing, Bitcoin outperformed gold by 2.9 times over about 3.5 years. Since fears of a banking crisis have increased this year, Bitcoin has rallied approximately 71% year-to-date, compared to gold’s rally of roughly 10% year-to-date.
READ MORE: Bullish on Bitcoin: Key Metric Signals Growth Potential
Jan van Eck, CEO of VanEck, a giant in exchange-traded funds (ETFs), recently predicted that both gold and Bitcoin are poised for multi-year bullish runs.
As per the report, Bitcoin’s role as a hedge against a possible economic downturn and the depreciation of the US dollar is critical and should not be overlooked.
Bitcoin’s ability to outperform gold during crises is an added advantage that is why many investors consider it a crucial part of their investment portfolio.
Alexander Stefanov
Reporter at CoinsPress
Alex is Editor-in-Chief of Coinspress and co-founder of Millennial Media Group, with nearly a decade of experience covering financial markets - crypto first, then everything else. It started in 2016 with Bitcoin. Like most people at the time, he didn't fully understand it - so he kept digging. Blockchain, tokenomics, the projects, the cycles. That curiosity never stopped, and eventually pulled him into traditional markets too: equities, commodities, macro. Not because he left crypto behind, but because you can't properly understand one without the other. What drives him is straightforward: he wants to know why something is happening, not just that it's happening. Most market coverage stops at the headline - price up, price down, here's a chart. Alex finds that kind of reporting actively unhelpful. If you walk away from an article without understanding the mechanism behind the move, what did you actually learn? He holds a degree in Tourism from New Bulgarian University - not the most obvious path into financial markets, but markets have a way of pulling in people who are simply too curious to stay out. He has authored over 200 in-depth analyses and more than 10,000 articles across crypto and traditional finance. He still thinks every day in markets teaches him something new. That's probably why he hasn't stopped.
