Fidelity: Gold to Pass Baton to Bitcoin

Jurrien Timmer, director of global macro at Fidelity, has opined that it might be Bitcoin's turn "to take the lead."

The Fidelity executive believes that gold might pass the baton to its digital rival in the near future based on the Sharpe ratios of the two assets.

Bitcoin's Sharpe ratio currently stands at -0.40, meaning that it has actually returned less than the risk-free rate. At the same time, the yellow metal, which has a Sharpe ratio of 1.33, has significantly outperformed Bitcoin while exposing its investors to a lower level of risk.

The leading cryptocurrency is down 17% against gold this year, with the latter benefiting from the economic mayhem caused by tariff-related disputes.

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Earlier today, Bitcoin approached the $98,000 level on the Bitstamp exchange, reaching the highest level since late February.

"Different players on the same team"

Timmer believes that investors should own both gold and Bitcoin. He believes that investors should own both of these assets in a 4:1 gold-to-Bitcoin ratio.

Still, according to the Fidelity executive, Bitcoin is “slightly different” since it can act both as hard money and a speculative asset.

“Bitcoin is slightly different than gold, since it has this Dr Jekyll & Mr. Hyde personality where you never quite know which Bitcoin is going to show up to the party,” he said.