(Kitco News) Is bitcoin really hurting gold? This question is on everyone’s mind as bitcoin is up 85% and gold is down 10% since the start of the year. And this debate is not dying out anytime soon, at least according to our top three stories from this week.
- Fed Chair Jerome Powell said that ‘crypto is a substitute for gold, not the U.S. dollar’. This kind of statement is pretty unprecedented coming from the Fed Chair, who also called bitcoin too volatile to be a global currency.
Powell stated: “Bitcoin is a speculative asset that is essentially a substitute for gold rather than the dollar.”
- CNBC’s Jim Cramer is now advising to have: 5% in gold and 5% in bitcoin. After telling investors to keep 10% of their portfolio in gold for almost four decades, Cramer has had a change of heart.
He said: “Gold let me down … If [investors] listen to me, they will drop half their gold. I’ve been saying 10% gold since 1983. And now, I say 5% in gold, 5% in bitcoin.”
- Our top story of the week is the CPM’s annual Gold Yearbook. A quick summary is that the pandemic has ‘changed the world’ and gold prices will reap the benefits.
The group stressed that while the pandemic will eventually end, it has accelerated some of the main drivers for gold.
CPM Group says governments will struggle to reverse their fiscal support. And gold’s triggers will be debt, deficit, and ultra-loose monetary policies.