BlackRock exec believes gold is overhyped as an inflation hedge
Crypto News

BlackRock exec believes gold is overhyped as an inflation hedge

BTC Peers Reporter

Russ Koesterich, an executive of the world’s largest asset manager, BlackRock, has taken a swipe at gold. He says that gold is failing as an inflation hedge amid massive outflows from the yellow metal and other ETFs into Bitcoin.

Koesterich is the portfolio manager at BlackRock’s Global Allocation Fund. He believes that gold is failing to prove itself as a viable hedge against inflation. Meanwhile, the price of the asset has dropped by more than 11% in the past six months. Koesterich remarked:

Gold’s ability to hedge against inflation has been somewhat exaggerated. While it is a reasonable store of value over the very long-term — think centuries — it is less reliable across most investment horizons.

Since setting a new all-time high of $2,100 per ounce in August 2020, gold has been on a steady decline. As of press time, the asset was trading around $1,700. On the flip side of gold’s underperformance is Bitcoin, which is up by almost 90% from the beginning of the year.

It is becoming common knowledge that some investors are dumping precious metals for Bitcoin. Senior Bloomberg analyst Mike McGlone had earlier said that investors were dumping gold for Bitcoin. BlackRock has also made some positive comments about Bitcoin, suggesting an investment in the cryptocurrency in the nearest future.