Bitcoin, Will It Really Replace Gold? The Market Landscape Is Changing

▲ Bitcoin (BTC), Gold/AI-generated image ©

An analysis suggests that Bitcoin (BTC) is moving from being a mere 'digital gold' to an asset that replaces gold, shaking the safe-haven asset paradigm itself.

According to the cryptocurrency specialized media Watcher.Guru on April 18 (local time), amidst rising geopolitical tensions, Bitcoin demonstrated a strong presence as a safe-haven asset, while gold, contrary to expectations, showed a bearish trend, exhibiting contrasting movements. Particularly, during the US-Iran conflict, a trend was observed where some investors moved funds to Bitcoin instead of gold.

Matt Hogan, Chief Investment Officer at Bitwise, estimated Bitcoin's total potential market size to exceed $34 trillion. During the same period, Bitcoin rose by approximately 12%, surpassing gold's 10% increase, indicating its superiority in the safe-haven asset competition.

Hogan pointed to three factors behind Bitcoin's rise: concerns about the erosion of fiat currency value due to increasing global debt and expanding fiscal deficits, a regulatory environment that has shifted from anti-crypto to pro-crypto, and the expansion of institutional investment access methods such as spot ETFs. He explained that the combination of these three elements makes a full-scale influx of institutional funds highly probable.

He believes that Bitcoin will erode the 'store of value' market traditionally dominated by gold. Furthermore, he assessed that its scope of use could expand to include means of storing overseas assets, replacing real estate and foreign exchange-based assets, and serving as a store of value for emerging market assets.

Based on these premises, Hogan projected that if Bitcoin captures approximately 25% of the store of value market by 2035, its price could reach around $1.3 million. He added that even this forecast might be conservative and that there is a possibility of it surpassing gold in the long term.

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