London Daily

Focus on the big picture.
Wednesday, Sep 17, 2025

Bitcoin or gold? Which is best buffer against inflation as crypto hits record high

Bitcoin or gold? Which is best buffer against inflation as crypto hits record high

BITCOIN hit a fresh high today, nudging $67000 after another dizzying rally which has seen the world’s most popular cryptocurrency more than double in price in three months.

The breakneck turnaround from July’s sub-$30000 low has revived talk in some quarters of crypto’s potential as a better hedge against global fears of rising inflation than gold.

A 10% rally this week, which paused for breath this afternoon, has been put down to the launch of a new fund in the US - the ProShares Bitcoin Strategy ETF - which offers exposure to the crypto without some of the risks of actually holding it.

The parallel with gold goes further: 20 years ago the first tradeable fund backed by gold was launched by Gold Bullion Securities.

A natural gas generator powering a bitcoin mining data centre on an oil field in North Texas

Now, the World Gold Council calculates the gold-backed ETF market to be worth $201 billion, because it’s much easier to hold an ETF in your portfolio, pension or ISA, than it is a gold bar.


On this week’s prices, however, Bitcoin looks a shoe-in as a safe haven over bullion which has failed to keep pace with rising fears around the world that inflation is out of control.

The price of gold is down 6.1% this year to $1780 an ounce .

It means one Bitcoin is worth 38 ounces of gold - just over a kilogram. A year ago, it was worth 5oz.

But before you start melting down your wedding ring there are few things to consider.

Investors are feeling the FOMO effect


Laith Khalaf, head of investment analysis at AJ Bell, said: “The prospect of new ETFs offering access to Bitcoin is potentially powerful.

“However that is offset by the fact that it’s already relatively easy for retail investors to buy and hold crypto.

“If the ProShares launch sparks a flood of other providers to enter the ETF market, that should be positive for Bitcoin demand.”

But while the price of Bitcoin has sizzled since July, the issues which prompted the crash from May’s previous highs around $64000 remain.

Tesla CEO and maverick crypto advocate Elon Musk pulled back in April, citing environmental concerns over the carbon footprint from the vast amounts of power needed to compute - or ‘mine’ - new coins.

And other companies are also feeling the breath of increasingly ESG-savvy investors down their necks.

Elon, for or against?


Khalaf added: “Companies won’t want to facilitate crypto payments if it impinges on their green credentials, particularly when transactions can already be quite easily fulfilled using dollars, euros or pounds.”

The crypto market has a long way to crawl


The issues of looming regulation and arbitrary intervention are also difficult to ignore.

China’s clampdown on crypto was generally blamed for the summer sell-off.

In the UK, regulator the FCA has banned the sale of crypto derivatives and Exchange Traded Notes to retail investors due to the complexity and extreme volatility of the underlying asset. Until the market matures that is unlikely to change.

That volatility has been reflected in the ProShares ETF today. After rallying at its launch - amassing $1.1billion in the second busiest ETF debut on record - it slipped back 2.5%.


Susannah Streeter at Hargreaves Lansdown said: “The FCA has been nervous about the number of retail investors risking their money in the crypto sphere for some time. It’s now worried the volatile nature of the coins and tokens could blow up in the face of the financial sector with more institutions piling in..

“UK Regulators appear to be holding fire right now as proposals to set up at central bank digital currency known as BritCoin are investigated and assessments made about the impact on the commercial banking system.

“Giving crypto assets a high-risk price tag may help limit contagion if they sharply fall in value, but central banks and regulators are on a tricky tightrope. If new rules are too strict, they risk quashing innovation in the rapidly developing decentralised finance world.

“If investors are feeling the FOMO effect, they should only dabble with crypto currencies at the edges of their portfolios with money they can afford to lose.”

Khalaf adds: “The crypto market is still in its infancy, and has a long way to crawl before it becomes mainstream.

“The launch of the ProShares ETF is a positive development for Bitcoin, but the longer term adoption of cryptocurrencies by businesses, consumers and regulators is much more important to long term returns, and all remain deeply uncertain.

“As such, consumers should only invest money in crypto they are willing to lose in its entirety.”

The warning was echoed in a note from Nicholas Colas, of DataTrek Research.

“This asset tends to peak around flashy events. Our recommended approach is to scale in slowly, over a period of months or years, rather than chasing it when it becomes frothy,” he wrote, adding: “Be careful.”

Newsletter

Related Articles

0:00
0:00
Close
European manufacturers against ban on polluting cars: "The industry may collapse"
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Trump: Cancel quarterly company reports and settle for reporting once every six months
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
US Launches New Pilot Program to Accelerate eVTOL Air Taxi Deployment
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Hong Kong Industry Group Calls for HK$20 Billion Support Fund to Ease Property Market Stress
Joe Biden’s Post-Presidency Speaking Fees Face Weak Demand amid Corporate Reluctance
Charlie Kirk's murder will break the left's hateful cancel tactics
Kash Patel erupts at ‘buffoon’ Sen. Adam Schiff over Russiagate: ‘You are the biggest fraud’
Homeland Security says Emmy speech ‘fanning the flames of hatred’ after Einbinder’s ‘F— ICE’ remark
Charlie Kirk’s Alleged Assassin Tyler Robinson Faces Death Penalty as Charges Formally Announced
Actor, director, environmentalist Robert Redford dies at 89
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
JD Vance Says There Is “No Unity” with Those Who Celebrate Charlie Kirk’s Killing, and he is right!
Trump sues the 'New York Times' for an astronomical sum of 15 billion dollars
Florida Hospital Welcomes Its Largest-Ever Baby: Annan, Nearly Fourteen Pounds at Birth
U.S. and Britain Poised to Finalize Over $10 Billion in High-Tech, Nuclear and Defense Deals During Trump State Visit
China Finds Nvidia Violated Antitrust Laws in Mellanox Deal, Deepens Trade Tensions with US
US Air Force Begins Modifications on Qatar-Donated Jet Amid Plans to Use It as Air Force One
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
Elon Musk Retakes Lead as World’s Richest After Brief Ellison Surge
U.S. and China Agree on Framework to Shift TikTok to American Ownership
London Daily Podcast: London Massive Pro Democracy Rally, Musk Support, UK Economic Data and Premier League Results Mark Eventful Weekend
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Musk calls for new UK government at huge pro-democracy rally in London, but Britons have been brainwashed to obey instead of fighting for their human rights
Elon Musk responds to post calling for the murder of Erika Kirk, widow of Charlie Kirk: 'Either we fight back or they will kill us'
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
USA: Office Depot Employees Refused to Print Poster in Memory of Charlie Kirk – and Were Fired
Proposed U.S. Bill Would Allow Civil Suits Against Judges Who Release Repeat Violent Offenders
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
French Debt Downgrade Piles Pressure on Macron’s New Prime Minister
US and UK Near Tech, Nuclear and Whisky Deals Ahead of Trump Trip
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
Anesthesiologist Left Operation Mid-Surgery to Have Sex with Nurse
Tens of Thousands of Young Chinese Get Up Every Morning and Go to Work Where They Do Nothing
The New Life of Novak Djokovic
The German Owner of Politico Mathias Döpfner Eyes Further U.S. Media Expansion After Axel Springer Restructuring
Suspect Arrested: Utah Man in Custody for Charlie Kirk’s Fatal Shooting
In a politically motivated trial: Bolsonaro Sentenced to 27 Years for Plotting Coup After 2022 Defeat
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
×