With governments and central banks in full stimulus mode, some observers reckon bitcoin is a useful safeguard against inflation - with supply capped at 21 million, its scarcity gives it an innate value.
Some who buy gold to hedge inflation risk may be turning to crypto, JPM’s Panigirtozoglou said, adding: “There is a reassessment of bitcoin about its value here as an alternative currency, as an alternative to gold.”
But bitcoin’s rise outstrips gold’s gains of 20% or so, while an inflation-linked government bonds index is up 4%.
And its rally has sped up in recent weeks even as gold has flatlined, and the resurgent pandemic makes growth and inflation recovery a distant prospect.