Speaking to Kitco News, Holmes stated that gold has the historical backing of being a safe haven asset during periods of war and political tensions. He noted that the market should not mistake gold’s poor 2021 performance as the reason to shun the asset. Holmes acknowledged that although Bitcoin is emerging as a critical alternative, the asset is yet to prove itself, considering it’s still a young asset class. However, Holmes believes that once Bitcoin beats several hurdles like regulations, it will take over gold as the go-to safe haven. The executive stated that gold is undervalued considering the current environment of high inflation and a potential rise in interest rates. He believes that the precious metal should be trading at around $4,000. However, he projects a target price of $2,500 to $3,000. Holmes also insinuated that Bitcoin and the crypto markets might not take off like gold. He states that regulatory clarity remains the main issue affecting Bitcoin, especially with G7 countries leading the way in defining how to handle digital assets. Interestingly, in a previous interview, Holmes stated that gold will rise in 2022, but Bitcoin will likely outperform the precious metal mainly driven by millennials.
Gold products attracting interest
Before Russia invaded Ukraine, gold-related investment products attracted interest from investors. As reported by Finbold, gold-backed stablecoins have gained traction, outperforming the overall growth of the cryptocurrency market. At the same time, the spot price of the precious metal also gained 4.67% in a week to trade around $1,900, the highest level in eight months. Interestingly, the price of gold appeared to falter after reports emerged that Russian forces were moving back to their bases after completing drills near the Ukrainian border. Watch the full interview below:
