'No need to lose faith': why Fundstrat's Tom Lee is betting on bitcoin vs. gold

Bitcoin may be a more effective savings vehicle than gold, according to Fundstrat Chief Investment Officer Tom Lee. At the Consensus Hong Kong conference, he said that the ineffectiveness of gold as a defense against inflation is confirmed by the statistics of returns over the past 50 years.

The value of the largest cryptocurrency fell below $66,000 on February 12, continuing its correction after rebounding last week. Bitcoin is now worth about 50% less than it was in October. Gold also sagged on Thursday, falling below $5,000.

Despite the drawdown, Lee is convinced that bitcoin will show higher efficiency for investors in the long term. Oninvest publishes a translation of a fragment of his speech on the advantage of cryptocurrency as a protective asset.

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Today, the total market value of gold is estimated at $41 trillion. This means it outperforms the S&P 500 index. In fact, the size of this market is comparable to the entire stock market in Asia combined.

I want to emphasize that in one day alone, January 31, the intraday fluctuation in the value of gold was $5.2 trillion. That is four times the capitalization of bitcoin. Gold has become such a giant asset that when it has such dramatic movements, it inevitably triggers a wave of margin calls in all other sectors. And if you're wondering why bitcoin has been so banged up this year, I believe it's directly related to how huge gold has become.

But the key question is different: Is gold a reliable savings vehicle? We analyzed gold's returns relative to inflation since 1971, based on a three-year rolling period. Every time the chart is colored red are the times when gold has lost to inflation. The bottom line is that over the past 50 years, gold has underperformed the store of value function 48% of the time, performing worse than inflation.

Now let's look at the period since bitcoin's inception. Bitcoin has succumbed to inflation in just five months out of 160. That means 5% of the time, excuse me, just 3% of the time.

However, over the same time period, gold lost to inflation 48% of the time. So, again, we should not lose faith in bitcoin. It has shown itself to be a better savings vehicle than gold, even though gold has looked more attractive over the past year.

So if you ask my opinion in 2026, my answer is that gold will perform worse than bitcoin.

This article was AI-translated and verified by a human editor