Precious Metals Surge Amid U.S. Dollar Decline, Bitcoin Gains Attention

According to Cointelegraph, precious metals are experiencing significant gains as the U.S. dollar faces debasement, with gold reaching $4,000 per ounce and silver hitting a 45-year high of over $50 per ounce. Despite this rally, there are indications that the momentum may be waning, prompting investors to consider alternative store-of-value assets such as Bitcoin (BTC) and tokenized real-world assets. Gold's impressive rally of over 50% this year, alongside a forecast by Goldman Sachs predicting a price of $4,900 per ounce by the end of 2026, suggests that the metal might be "overheated," according to Nic Puckrin, founder of the Coin Bureau education company. Puckrin noted that after such a substantial increase in gold prices, attention might shift to other alternatives that offer similar value propositions, including other metals, commodities, tokenized real assets, and Bitcoin, which are perceived as undervalued compared to gold. These assets are seen as hedges against fiat currency inflation and geopolitical uncertainty. Bitcoin has also reached a record high of over $126,000 in October, coinciding with the historic surge in precious metals prices. This comes as investors express diminishing confidence in the U.S. dollar, which is on track for its worst performance since 1973. Market analysts at the Kobeissi Letter highlighted that the U.S. dollar is experiencing its most significant decline since 1973, having lost over 10% year-to-date and 40% of its purchasing power since 2000. The debasement of the U.S. dollar has led to a simultaneous rush into both store-of-value and risk assets, which traditionally move in opposite directions. Typically, safe-haven and store-of-value assets increase in value when risk assets like stocks decline, and vice versa. This trend indicates that investors are adjusting asset valuations for a "new era of monetary policy," characterized by higher inflation and government financing through further currency devaluation, leading to a rise in all asset prices. Bitcoin is well-positioned to benefit in the fourth quarter due to ongoing currency debasement, as investors seek to preserve wealth by investing in safe-haven assets, according to Matt Hougan, chief investment officer at investment firm Bitwise.