Yet the most compelling argument of all is the fact that bitcoin’s supply is truly fixed, unlike that of gold. Only 21 million bitcoins will ever be produced – a fixed supply in the face of sharply rising demand. In its early days, only individuals bought bitcoin. Today, institutions are – from endowments and Fortune 500 companies to billionaires and hedge funds. There are only 47 million millionaires in the world; if they each wanted just one bitcoin, they couldn’t get them. This creates the most incredible supply/demand opportunity in history – virtually guaranteeing massive price increases, some say.
Who says that? Tom Fitzpatrick, for one. The global head of Citibank CitiFXsm TECHNICALS,says bitcoin’s price will reach $318,000 by year-end. Guggenheim pegs bitcoin’s future price at $400,000. ARK Invest says bitcoin will reach $500,000. And the Association of Governing Boards of Universities and Colleges says, “Cryptocurrency has already produced hundreds of millionaires, a number of billionaires and may produce the world’s first trillionaires in the next decade.”
So, which is it? Gold or bitcoin?
I’ve been engaged in the bitcoin community since 2012 and founded DACFP in 2018, creator of the Certificate in Blockchain and Digital Assets® for financial advisors. Everyone knows I’m a strong bitcoin proponent. That said, I believe the “gold vs. bitcoin” debate is silly.
I’ve never understood why “bitcoin” and “gold” ever appear in the same sentence. The debate is a manufactured contortion by extremists who believe the only way they can be right is if everyone else is wrong.
Let’s end the debate. There’s no need to choose between the two. Instead, if you are truly a disciple of portfolio diversification, you should own gold and bitcoin! The two are like stocks and bonds – you own both of them as part of a diversified portfolio, don’t you? Gold and bitcoin are no different.
Don’t like gold? Don’t like bitcoin? So what. You already have assets in your client portfolios that you don’t like. You own them as part of a broadly diversified portfolio. Gold and bitcoin are no different.
Stop this foolish debate. Let’s argue instead about whether your clients should own bonds during a period of rising tax rates, interest rates and inflation. Hey, I’m just trying to give y’all something worthwhile to argue about. Because gold vs bitcoin ain’t it.