Can Bitcoin replace Gold? This debate has been with us for several years. On the one hand, there are Gold advocates such as Peter Schiff and many investment bankers, managers, and economists who don’t see Bitcoin’s narrative as a Gold substitute. In this article, we look at JPMorgan analyst Nikolaos Panigirtzoglou’s opinion on Bitcoin and Gold.
In his opinion, Bitcoin now threaten the precious metal as a substitute.
According to analyst Nikolaos Panigirtzoglou, a paradigm shift in large institutions and family offices’ investment policy is imminent.
As a result, Bitcoin’s increasing acceptance leading institutional investors to invest in Bitcoin’s portfolio. This would be a disease for Gold, as allocating funds into the precious metal decreases overtime.
Nikolaos Panigirtzoglou works for the central American bank JPMorgan in the field of quantitative analysis. In his opinion, the “Bitcoin as digital gold” narrative is becoming more and more effective. In his view, this means that Gold is likely to lose investors’ attention over the next few years.
In portfolio management, a restructuring of existing portfolio shares is also called reallocation.
This process is part of good portfolio management and ensures a desired balance of the individual positions.
Panigirtzoglou takes up this aspect and says that just 0.18% of the Family Office portfolios invest in Bitcoin on average. On the other hand, there is a gold share of 3.3%. If you take this data as a starting point and assume a small reallocation, this can mean a fundamental tailwind for the BTC price.
The JPMorgan analyst said:
Bitcoin adoption by institutional investors has just begun. For Gold, on the other hand, adoption is well advanced. If my assumption is correct in the medium to long term, the price of Gold will suffer massively; as a result of BTC adoption.
The fact is that companies like Grayscale impressively show how high the demand for Bitcoin is from institutional investors. The big names like MicroStrategy, PayPal, attracted a lot of attention for Bitcoin this year.
Bitcoin is trading stable above 18,000 US dollars despite recent corrections, preparing for 2021.