Key Takeaways

  • Bitcoin is capturing the mind share of younger generations because of its volatility and their appetite for risk will continue to drive speculation.
  • Some argue bitcoin’s latest parabolic move is stealing market share from gold but that’s only the tip of the iceberg. For perspective, net outflows from the two largest gold ETFs (GLD & IAU) totaled ~$5.7 billion in Q4 2020; Bitcoin added ~$340 billion in total market value over the same period.
  • Bitcoin wasted no time in the new year, kicking off 2021 with a +35% gain in its first week of trading. Notably, BTC is now one of the best performing assets since its previous December 2017 peak, recently surpassing even the almighty Nasdaq 100 on a total return basis.

Much has been made of bitcoin’s price volatility, especially among traditional investors who still hesitate to put their faith in a digitally-native asset that promises to redefine the very core of our financial system (hint: money). But I believe the volatility argument is a bit tired and long overdue for reevaluation.

The stark differences in average time horizon and risk tolerance sits at the center of the bitcoin versus gold debate, which arguably has become one of the most polarizing standoffs in investment circles recently (the lack of indifference when it comes to bitcoin and gold is also partially to bl

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