Grayscale Flips World’s Largest Gold Fund — Has Bitcoin Become The Supreme Inflation Hedge?
It’s not a great day for gold bugs now that Grayscale has ‘flippened’ gold’s biggest asset manager. Is Bitcoin officially the go-to inflation hedge for institutional investors?
Covered:
- Grayscale’s Updated Holdings
- The Real Gold ‘Flippening’
Grayscale asset management giant has flipped SPDR Gold Shares (GLD). GLD is the largest gold management firm in the world with $57.3 billion in assets under management (AUM). As of yesterday, Grayscale officially flipped GLD in total AUM after surpassing $60 billion in AUM.
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Grayscale’s Updated Holdings
Yesterday, Grayscale CEO Barry Silbert shared an overview of the firm’s updated holdings on Twitter.
11/10/21 UPDATE: Net Assets Under Management, Holdings per Share, and Market Price per Share for our Investment Products.
Total AUM: $60.8 billion$BTC $BAT $BCH $LINK $MANA $ETH $ETC $FIL $ZEN $LTC $LPT $XLM $ZEC $UNI $AAVE $COMP $CRV $MKR $SUSHI $SNX $YFI $UMA $BNT $ADA $SOL pic.twitter.com/9n4GgntN8H
— Grayscale (@Grayscale) November 10, 2021
The firm’s flagship investment product, the Grayscale Bitcoin Trust (GBTC), holds over 646,000 BTC worth around $43.57 billion currently, making up nearly 72% of the asset manager’s holdings. The Ethereum Fund (ETHE) makes up 25% of the fund, and the remaining 3% contains a basket of various altcoins, including Litecoin, Chainlink, Decentraland, and others.
With over 646,000 Bitcoin now under the company’s oversight, Grayscale holds over 3% of the current 18.8 million Bitcoin in circulation.
The Real Gold ‘Flippening’
With inflation running hotter than usual in the US, gold’s historic reign as the superior inflation hedge is slowly getting overtaken by Bitcoin. At least that’s what JP Morgan thinks.
JP Morgan: Case for #Bitcoin strengthened by "failure of gold" to hedge inflation pic.twitter.com/pZduljNNqY
— Bitcoin Magazine (@BitcoinMagazine) November 3, 2021
Upon the news of the consumer price index hitting 6.2% inflation in October, Bitcoin spiked more than 4% to $68,733. Despite the pullback shortly after, the quick price reaction speaks volumes as to where investors’ attention is turning when faced with inflationary pressures.
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While Grayscale surpassing the world’s largest gold manager is certainly a massive milestone for Bitcoin and the crypto industry as a whole, the real gold ‘flippening’ won’t occur until Bitcoin can flip the total market cap of the traditional safe-haven asset.
With a market cap of $1.23 trillion, Bitcoin will need to appreciate roughly 10x to flip gold, which currently boasts an 11.83 trillion market cap. At the current market cap of gold, Bitcoin would be priced at $627,995.
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Text source: CryptosRus
