Bitcoin (BTC) gains the upper hand in the battle between gold and Crypto Assets: the rise of digital gold and the challenge to traditional values.

When gold supporter Debra Robinson scoffed, "Imagine spending $118,000 to buy a set of artificial digits," she was responding to a common skeptical attitude among precious metal enthusiasts. However, as Bitcoin prices continue to reach new highs and gradually secure a place in the global financial system, the debate over the store of value between "digital gold" and "physical gold" is becoming increasingly thought-provoking. Respected macro analyst and Bitcoin bull Lyn Alden offered pragmatic advice: precious metal enthusiasts could purchase a Bitcoin position equivalent to 5% of their precious metal holdings. This is not only a hedging of risks but also a wise layout for future trends.

1. Why should gold supporters pay attention to Bitcoin?

As of the writing of this article, the trading price of Bitcoin is slightly below $118,000, recently reaching an all-time high, reflecting the uncertainty of the global economy and concerns about inflation. The market capitalization of this group of "artificial digital" assets has currently exceeded $2.2 trillion, surpassing silver, becoming one of the most valuable assets in the world. Even more noteworthy is that 100 publicly traded companies, including BlackRock and Strategy, collectively hold nearly 1.3 million BTC, accounting for about 6% of the total supply, indicating that institutional recognition of Bitcoin is continually increasing.

Fairly speaking, gold has also performed well recently, with prices approaching slightly above the historical high of $3,500, reaching $3,355 per ounce. However, the 5% allocation recommendation from Alden is not intended to abandon gold but rather for risk management. For holders of $100,000 in gold, holding $5,000 in Bitcoin can hedge against the risk of Bitcoin continuing to erode gold's traditional role as a store of value.

If Bitcoin continues to perform well, then this small allocation to Bitcoin can provide upside risk; even a moderate allocation can have a significant impact on the overall portfolio return. If Bitcoin crashes, as many gold supporters firmly believe, the losses would only account for a small portion of the portfolio. As Oden said: "They can go to the beach and forget about this asset forever." This is a pragmatic strategy that balances potential gains with risk control.

II. Past Resonance: A Historical Perspective on the Status Change of Bitcoin

The author of the book "The Bullish Case for Bitcoin", Vijay Boyapati, presents his views from a historical perspective. He commented: "I recommended this back in 2013. At that time, I viewed Bitcoin as insurance against gold. Now, I view gold as insurance against Bitcoin."

Boya Pati's comments reflect a significant change in the risk profile of Bitcoin over the past decade. Bitcoin was once a speculative hedging tool for gold investors, but it has now become the main character in the eyes of many, while gold plays a supporting role. This indicates that the market's perception of Bitcoin as a store of value has shifted from an initial "experimental asset" to a "core asset."

However, not everyone is convinced. Notorious Bitcoin skeptic Peter Schiff (Peter Schiff) has once again come forward to criticize the number one ranked crypto asset. Despite Bitcoin's price hitting new highs, Schiff recently urged investors to sell their Bitcoins and buy silver, pointing out that "Bitcoin is still a risky bet, while silver offers more upside potential and minimal downside risk." However, as businesses and institutions accelerate their adoption of Bitcoin, Schiff's warnings are increasingly being ignored.

Three, the Rise of Bitcoin: An Inevitable Choice of Technological Transformation and Risk Management

Even allocating a small portion of a metal investment portfolio to Bitcoin is a reasonable hedging measure to avoid unexpected losses from technological changes. As Boyapati stated, the logic of hedging with Bitcoin will only become stronger with the surge in adoption, liquidity, and institutional interest.

The underlying technology of Bitcoin—blockchain—endows it with characteristics such as decentralization, scarcity, and censorship resistance, making it a unique store of value in the digital age. Compared to the physical storage and transportation costs of gold, the digital nature of Bitcoin allows for more convenient and efficient transfer and storage on a global scale.

Gold supporters may scoff at the idea of paying six figures for a digital currency, but the numbers don't lie: the rise of Bitcoin is reshaping the landscape of store of value. As Lyn Alden and Vijay Boyapati have said, a modest allocation to Bitcoin is not only speculation but also prudent risk management in a rapidly evolving world.

Conclusion:

The battle for the store of value between Bitcoin and gold is not simply a matter of which is superior, but rather reflects the evolution of financial markets in the digital age. The rapid rise of Bitcoin has challenged the traditional status of gold as a millennium-old store of value tool, providing investors with new options. In an uncertain global economic environment, incorporating Bitcoin into an investment portfolio, even with a small allocation, could be a wise move to respond to future changes and capture potential gains. This struggle for value between the digital and physical will continue to write new chapters.