'Bitcoin is Offensive, Gold is Defensive': Bitwise

In brief

• Gold is a “better cushion” during falling markets, while Bitcoin offers greater upside during rebounds, according to Bitwise Head of Europe Bradley Duke.
• Bitcoin’s perceived role as “digital gold” has come into question as the precious metal has soared while BTC has crashed.
• A panel at Digital Assets Forum London argued that the significance of Bitcoin’s four-year “halvings” has diminished.

Gold and Bitcoin work most effectively when they’re in the same portfolio, a Bitwise executive has argued. Speaking at the Digital Assets Forum in London, Bradley Duke, Managing Director and Head of Europe at the digital asset management firm said that gold “is a better cushion” when markets are falling, while BTC offers greater upside during rebounds. “One is more to the upside risk and the other is more protecting against the downside of uncertainty,” Duke said.

The Bitwise exec was speaking during a panel examining whether crypto’s four-year cycles are dead. Ominously, the discussion was held on Thursday, when Bitcoin fell almost as low as $60,000 during a punishing drawdown. The analogy of Bitcoin as “digital gold” has taken a hammering of late, with both assets on divergent paths. While the precious metal has surged by 46% over the past six months, setting a new all-time high in the process, the world’s biggest cryptocurrency is down 40% over the same period. When asked about why gold had proven more popular than Bitcoin of late, Duke pointed to “muscle memory,” with investors flocking to a safe haven asset that has existed for thousands of years. “Allocators and countries have bought gold in this way for hundreds of years and will continue to do that until there is the trust established in this new better money, which is Bitcoin,” he added. “But that takes time.” On prediction market Myriad, owned by Decrypt’s parent company Dastan, users put a 67% chance Bitcoin costing 10 oz of gold rather than 30 oz after its next move.

 Bitcoin’s “four-year cycle” Until recently, many analysts believed that BTC operated in four-year cycles of boom and bust, driven by “halvings” where the supply of new Bitcoin entering the market permanently falls by 50%. This last happened back in 2024, with the next expected to take place in April 2028. But according to those on the panel, the significance of halvings has diminished—primarily because most of the 21 million Bitcoin that will ever exist is already in circulation—with volumes from exchange-traded funds also blunting this digital asset’s volatility. Anatoly Crachilov, CEO of Nickel Digital, said the supply of new BTC has been “completely dwarfed by ETF flows, by basis trades and by treasury acquisitions.” Duke argued that Bitcoin was "growing up,” and “bootstrapping itself to become a macro asset for the long term.” Where initially, the only Bitcoin investors were “cypherpunks and what we call OGs now,” he added, “today we see sovereign states investing in Bitcoin.” The managing partner of Fifth Era Blockchain Coinvestors, Matthew Le Merle, admitted that Bitcoin’s recent contraction was “very challenging,” especially for investors who bought at the top. However, he argued that a more pressing matter is turning Bitcoin into “a global peer-to-peer cash” at a time when only a few thousand top-tier blockchain developers exist worldwide, and many risk being drawn to alternative industries such as artificial intelligence. “If you’re investing because you think you can time the market because you think there’s a cycle and you want to trade and make a quick buck, you’re in the wrong room,” he warned. “That’s not what this is about.”