Proponents of Bitcoin argue that it’s muscling in on gold as a hedge against US dollar weakness and inflation risk, citing evidence of growing interest among institutional investors. Skeptics view the digital asset’s more than 300% surge over the past year as a risky bubble fueled by investors chasing the momentum in cryptocurrency prices.
“The drivers of the crypto rally, if anything, are strengthening amid still low interest rates, political uncertainty” and the prospect of more government stimulus, Julian Emanuel, chief equity and derivatives strategist at BTIG LLC, said in an email. But he added that volatility can work both to the upside “as well as to the downside.”
