In its latest weekly report, Matrixport emphasizes that the ongoing demand for bitcoin (BTC) and gold is driven by two major macroeconomic forces: the efforts by central banks to reduce reliance on the U.S. dollar and the rapid rise in sovereign debt levels. The report projects that these dynamics will continue to fuel the long-term growth of both assets, encouraging investors to consider including them in their portfolios.
Strong Performance in 2024
So far in 2024, bitcoin and gold have significantly outperformed traditional assets. Bitcoin has surged 59% this year, while gold is up 31%, exceeding returns from bond ETFs and the S&P 500 Index (+22%).
Gold’s retail demand has expanded, with Costco reporting monthly gold sales of $200 million. Central banks, particularly in emerging markets, continue to purchase gold to hedge against dollar dependence, underscoring the metal’s growing strategic role.
Institutional Interest in Bitcoin Grows
Bitcoin’s unique dual role as both a speculative asset and a store of value is increasingly recognized. Institutional interest is rising, supported by developments such as the potential approval of spot bitcoin ETFs and large-scale investments by companies like MicroStrategy. Matrixport’s report highlights that some central banks indirectly acknowledge bitcoin’s importance by investing in companies that hold BTC, such as MicroStrategy.
Macroeconomic Uncertainty Fuels Demand
Concerns over global economic instability, rising government debt levels, and the risk of inflation are driving demand for both gold and bitcoin. As governments may resort to money printing to manage debt repayments, these assets provide protection against currency depreciation.
Investors holding bitcoin and gold have benefited from these trends in 2024 and are likely to see continued gains as macroeconomic headwinds persist.
On-Chain Innovations: Tokenized Gold
Looking ahead, Matrixport notes the rise of tokenized gold, which offers investors a blockchain-based alternative to traditional gold investments. This innovation is expected to further boost demand for both bitcoin and gold during periods of economic uncertainty, providing new avenues for investors seeking stability.
As macroeconomic pressures build, the combination of bitcoin’s digital innovation and gold’s historical reliability could prove to be essential tools for portfolio diversification and wealth preservation.
