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John Authers

Bitcoin Is Displacing Gold as an Inflation Hedge

The digital asset’s increasing scale has made it a more viable competitor to the traditional protector against currency debasement.

It’s clear which asset is hotter.

It’s clear which asset is hotter.

Photographer: Luke MacGregor/Bloomberg
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How to explain bitcoin? As I said a couple of weeks ago, it’s hard to dismiss the digital currency as a classic investment bubble because — unlike any of the other historical manias which have seen similarly extreme gains in price — it has formed a series of bubbles, which have burst and then reinflated. Bubbles aren’t supposed to do this: They are booms grown so large that they cannot gently deflate and must burst, never to return.