Bitcoin, the world’s largest cryptocurrency, is seen as a strong hedge against inflation after the Bitcoin asset said it was better than gold with a 97% probability of outperforming inflation.
He also said Ethereum could benefit from Wall Street tokenization and AI-driven infrastructure development, noting growing interest from institutional investors.
Bitcoin outperforms gold as an inflation hedge
Speaking at the Futu Investment Exhibition, Tom Lee said many investors still rely on gold as the safest asset during inflation. However, historical data shows that gold has not always protected wealth as people believe.
Over the past 55 years, gold has underperformed inflation about 48% of the time, he said. This means that gold has not always protected purchasing power, despite the widespread belief that gold will appreciate during times of economic uncertainty.
Gold prices have fallen more than 15% over the past week, marking the steepest decline in a decade and are currently trading around $4,493.
Bitcoin, on the other hand, has performed much better against inflation since its creation in 2009. According to Lee, Bitcoin outperforms inflation 97% of the time, making it one of the most powerful inflation hedges of our time.
“While many investors hold large amounts of gold for protection, they may be overlooking exposure to Bitcoin. With a fixed supply of 21 million coins and increasing adoption, Bitcoin is increasingly seen as digital gold,” Lee said.
Institutional adoption and ETF demand strengthen Bitcoin case
Institutional demand through ETFs and corporate treasury allocations also strengthened Bitcoin’s position.
Since the launch of Bitcoin ETFs, asset managers around the world have increasingly added Bitcoin to their portfolios, resulting in approximately $56 billion in inflows. Due to this change, Bitcoin is gradually transitioning from a speculative asset to a macro hedge similar to gold.
Bitcoin is currently trading around $66,000 after falling 3.4% in the past 24 hours.
Ethereum and Wall Street Tokenization Opportunities
Lee also talked about Ethereum, which he said could become very important to Wall Street in the future. He believes Ethereum can be used for tokenization, payments, and financial infrastructure.
This shows that the cryptocurrency industry is slowly moving from speculation to real financial use cases.
