Precious metals are soaring in response to the US dollar debasement, with gold hitting $4,000 per ounce and silver reaching a 45-year high of over $50 per ounce. Still, the precious metal rally may be running out of steam, allowing for investor rotation into alternative store-of-value assets like Bitcoin (BTC) and tokenized real-world assets.
Gold’s more than 50% rally so far this year — coupled with Goldman Sachs’ forecast of $4,900 per ounce by the end of 2026 — suggests the metal is “overheated,” according to Nic Puckrin, founder of the Coin Bureau education company. He said:
“After more than a 50% rally in the gold price year-to-date, attention may now turn to other alternatives that express a similar view. These include other metals and commodities, tokenized real assets, and Bitcoin, which remain undervalued against gold.”
Puckrin added that these assets all serve as hedges against fiat currency inflation and geopolitical uncertainty.
Bitcoin hit a record high of over $126,000 in October, alongside a historic surge in precious metals prices. Meanwhile, investors are losing confidence in the US dollar, which is on track for its worst year since 1973.
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Bitcoin poised to benefit from US dollar decline
“The USD is now on track for its worst year since 1973, down over 10% year-to-date. The USD has lost 40% of its purchasing power since 2000,” market analysts at the Kobeissi Letter wrote on Sunday.
US dollar debasement has caused a rush into store-of-value and risk assets simultaneously, which typically run counter to each other. Safe-haven and store-of-value assets usually increase in value when risk assets like stocks decline, and the reverse is also true.
This signals that investors are repricing assets for a “new era of monetary policy,” one where inflation runs higher and the government finances operations by devaluing the currency further, causing all asset prices to rise, the analysts said.
BTC is positioned to surge in Q4 as a result of ongoing currency debasement, as investors seek to preserve wealth by piling into safe-haven assets, according to Matt Hougan, chief investment officer at investment firm Bitwise.
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