As geopolitical tensions rise and the U.S. presidential election approaches, analysts at JPMorgan (JPM) see a bright future for both Bitcoin (BTC-USD) and gold (CM:XAUUSD). They argue that these assets may benefit from what they term the “debasement trade,” where investors seek refuge in hard assets amid economic uncertainty. According to their report, “A Trump win in particular… would likely reinforce the ‘debasement trade’ both via tariffs and via an expansionary Fiscal policy.”
Markets Eyeing Potential Trump Victory
Interestingly, markets have yet to fully price in a potential win for Donald Trump, which analysts believe could significantly affect financial dynamics. The report states that the current low probability assigned to a Trump victory stems from investor focus on recessionary concerns. However, JPMorgan recalls the events of 2016, when the “Trump trade” led to soaring U.S. Treasury yields and a strong dollar. The bank’s analysts suggest that if history repeats itself, we could witness similar movements soon.
Bitcoin Faces Skepticism Despite Growing Demand
It’s important to note that while Bitcoin is expected to benefit from this uncertainty, not everyone views it as a safe haven. Standard Chartered recently stated that Bitcoin may not serve as a buffer against geopolitical risks. Yet, the increasing demand for Bitcoin as a digital alternative to gold, particularly in tumultuous times, may still bolster its price as investors seek to hedge against inflation and currency devaluation.
What Is the Price of Bitcoin and Gold Right Now?
At the time of writing, Bitcoin is sitting at $61,565.25, and gold is hovering at $2,648.13.
