Bitcoin's Scarcity Advantage
Ark's Cathie Wood, in a recent 2026 report, asserts that Bitcoin surpasses gold as a scarce asset due to its mathematically fixed supply. Wood highlighted that while gold has seen a 166% surge with a 1.8% annualized increase in global supply, Bitcoin has climbed 360% with a more modest 1.3% annualized increase in its total supply.
Wood further elaborated that a critical difference lies in how Bitcoin and gold miners respond to price signals. Gold miners have the capacity to increase the production of undiscovered gold, a possibility that does not exist for Bitcoin.
Previously, Wood explained that Bitcoin's scarcity is intensifying because its annual supply increase diminishes to 0.9% after each halving event. The seasoned investor maintains a strong optimistic outlook on cryptocurrencies, projecting that Bitcoin could reach $1.5 million by 2030. She later adjusted this projection slightly downward to $1.2 million, taking into account gold's market performance and the increasing popularity of stablecoins.
Bitcoin as a Diversification Asset
Ark's Cathie Wood also observed that Bitcoin exhibits a low correlation with gold, standing at 0.14, and an even lower correlation with bonds, at 0.06. This characteristic positions Bitcoin as an optimal source of diversification for asset allocators aiming for higher returns per unit of risk in the coming years. Bitwise CIO Matt Hougan lent support to Bitcoin's scarcity thesis, suggesting that sustained institutional demand exceeding supply could lead to a "parabolic blowoff" for Bitcoin.
The Ark CEO recently suggested that gold prices might have reached a point of "irrational exuberance" in relation to the money supply. Concurrently, she championed Bitcoin as the ultimate diversifier, emphasizing that Bitcoin's correlation with traditional asset classes remains close to zero. Wood now contends that allocators have a fiduciary responsibility to consider crypto assets to optimize portfolio returns and manage risks.
Wood further noted that Bitcoin's mining and supply are strictly governed by its protocol, with new issuance anticipated to increase by approximately 0.8% annually for the next two years. Following this period, the annual supply growth is expected to decelerate to about 0.4% per year from 2028 onwards.
In parallel, Bernstein analysts maintain a bullish stance on Bitcoin as a superior hedging asset compared to gold, predicting that Bitcoin could reach $200,000 by 2027. Standard Chartered has also revised its 2026 Bitcoin price prediction, halving it from $300,000 to $150,000.
Gold's 2025 Performance Puts Pressure on Bitcoin
Reports indicate that gold's performance in 2025 has created direct competitive pressure on Bitcoin as a store of value and an inflation-hedge asset. Gold's year-to-date gain of 69% outperformed Bitcoin's year-to-date decline of 5%, raising concerns about Bitcoin's claimed superiority as an alternative value preservation asset.
The credibility of Bitcoin's "digital gold" narrative also suffered a significant blow as a struggling Bitcoin faced competition from gold, which delivered comparatively higher returns. Unlike cryptocurrencies, gold's value is derived from universal recognition, a long-standing track record as a wealth preservation asset, and its physical scarcity. Gold's non-digital nature apparently provides reassurance to investors concerned about technological vulnerabilities and failures.
Gold's performance in 2025 is reportedly prompting a reconsideration of portfolio allocations and raising questions about diversification strategies. Allocations to gold are likely to increase, driven by the precious metal's demonstrated diversification benefits and crisis-hedging value in 2025.
However, Geigii Verbitskii, the founder of TYMIO, argues that Bitcoin's 2025 performance appears weak only when viewed in isolation, emphasizing that context is crucial. According to Verbitskii, Bitcoin experienced a sharp rise in 2024, making the 2025 consolidation period entirely normal and justified.
The TYMIO executive believes that 2026 is a year for holding assets rather than actively buying and selling. He further notes that while gold offers stability, Bitcoin provides "asymmetric upside." He also pointed out that Bitcoin has historically grown at a faster rate than gold and anticipates this trend to continue this year.