Is Bitcoin Leaving Gold in the DUST?

Billionaire investor Jeffrey Gundlach just dubbed Bitcoin the next ‘stimulus asset’, which could put downward pressure on gold. Direxion Daily Gold Miners Index Bear 2X Shares (DUST) is all ears.

Gundlach has been a strong proponent of gold, but Bitcoin could be giving him pause.



DUST seeks daily investment results before fees and expenses of 200% of the inverse of the daily performance of the NYSE Arca Gold Miners Index. The fund invests in swap agreements, futures contracts, short positions, or other financial instruments that, in combination, provide inverse or short leveraged exposure to the index equal to at least 80% of the fund’s net assets.

The index is a modified market capitalization weighted index comprised of publicly traded companies that operate globally in both developed and emerging markets, and are involved primarily in mining for gold and, to a lesser extent, silver.

DUST has been rising 14% so far this year thanks to outflows from precious metal funds. As the flight from safe haven metals continues amid a global vaccine rollout, continue to look for more bearishness ahead.

DUST Chart

Are More Bitcoin Bulls Joining the Market?

With Canada debuting the first Bitcoin ETF, and the leading cryptocurrency reaching the $50,000 price level, it’s hard to wonder what the future holds. For now, Bitcoin is getting a vote of confidence from other sources.

“Gundlach’s comments are the latest in a slew of analysts and investors predicting that bitcoin may soon replace gold as a digital safe haven asset,” a Financial News article said. “JPMorgan’s Nikolaos Panigirtzoglou is one such bull, having made the case for bitcoin as digital gold on several occasions with a long-term price target on the coin at $146,000. However, the bank has said it does not expect bitcoin to reach that target soon, with price volatility informing an overall peak prediction of $35,000 this year.”

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