The Coinbase CEO Brian and a CryptoQuant analyst have explained why it would be more beneficial for countries to prioritize Bitcoin over gold.
Discussions surrounding Bitcoin’s potential as a reserve asset have gained momentum, particularly after President Donald Trump signed an executive order exploring a digital asset reserve. As a result, industry leaders are now advocating for Bitcoin to replace traditional reserve assets like gold and oil.
Analyst Insists Investors Should Prioritize Bitcoin over Gold
As these discussions gain steam, Axel Adler Jr., a CryptoQuant analyst, recently pointed to Bitcoin’s impressive performance against traditional assets as an important factor, contending that it is more economically wise to prioritize Bitcoin over gold.
I see no economic efficiency for investors in putting money into gold. Over the past twelve years, the price of one ounce of gold has dropped from 732 BTC to 0.02 BTC. If the current growth rate of Bitcoin relative to gold continues, in 10 years, the price of one ounce of gold… pic.twitter.com/2sCq3Lm1jF
— Axel 💎🙌 Adler Jr (@AxelAdlerJr) January 24, 2025
“I see no economic efficiency for investors in putting money into gold,” Adler boldly stated. He highlighted that gold has seen a massive decline against Bitcoin in the past years.
For context, over the last twelve years, the value of one ounce of gold fell from 732 BTC to 0.02 BTC. According to Adler, if Bitcoin continues to outperform gold at the current rate, the value of gold in Bitcoin terms could become negligible within a decade.
He pointed out that Bitcoin has outpaced gold by an average of 37 times annually. The market analyst believes this trend will inevitably prompt major investors, including bankers and fund managers, to shift their allocations from gold to Bitcoin.
BTC Continues to Outpace Gold
In a separate disclosure, Adler also noted that Bitcoin has outshined oil in addition to gold. An accompanying chart shows that in the last six years, gold dropped 91% against Bitcoin, moving from 0.294 BTC per ounce to 0.026 BTC. Oil has faced a similar fate, declining from 0.008 BTC per barrel to 0.0007 BTC per barrel in the same period.
Bitcoin Against Gold and Oil | CryptoQuant
The analyst further suggested that Bitcoin’s scarcity and ease of purchase in varying amounts contribute to its appeal. According to Adler, these qualities make it particularly attractive to younger investors who are shifting away from conventional assets like gold and oil.
Coinbase CEO Agrees
Meanwhile, Brian Armstrong, CEO of Coinbase, noted in a previous commentary that Bitcoin’s current market capitalization of around $2 trillion represents roughly 11% of gold’s estimated $18 trillion market cap.
Today, Bitcoin’s market cap of ~$2T represents about 11% of gold’s market cap of ~$18T.
Bitcoin is a better form of money. It has the decentralization and scarcity of gold, but better divisibility, portability, and (i think) even fungibility. It’s relatively harder to tell if… https://t.co/DJJxj4EA6n pic.twitter.com/51LSKaU49a
— Brian Armstrong (@brian_armstrong) January 23, 2025
Armstrong asserted that Bitcoin holds massive advantages over gold, such as improved security, portability, and divisibility. Notably, unlike gold, which can be difficult to verify for purity, Bitcoin’s digital nature ensures transparency and authenticity.
The Coinbase CEO further argued that countries with gold reserves should allocate at least 11% of their holdings to Bitcoin. He believes Bitcoin’s market cap will surpass gold within the next decade, making it prudent for nations to establish strategic Bitcoin reserves now.
Furthermore, Armstrong added that countries leading in Bitcoin adoption could set a precedent for others, potentially inspiring G20 nations to follow suit. Also, to Adler, the Trump administration’s focus on supporting crypto through the “Crypto Capital” agenda could accelerate Bitcoin’s adoption.
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