Why the bitcoin trade 'is too large to ignore'

Why the bitcoin trade ‘is too large to ignore’

October 8, 2025

Bitcoin (BTC-USD) and gold (GC=F) climbed to record highs this week, underscoring two sides of the so-called debasement trade as investors hedge against weakening fiat currencies.

Even traditional gold bulls are taking notice of bitcoin’s growing role as “digital gold.”

“The bitcoin trade is too large to ignore,” Paul Karger, Twin Focus co-founder and managing partner, told Yahoo Finance on Wednesday. “Everybody that’s been calling bunk on bitcoin the last decade has been proven wrong.”

On Wednesday, bitcoin hovered near $124,000, down from Monday’s all-time high north of $125,000. The world’s largest cryptocurrency is up 31% year to date.

Karger said he still favors a larger 5% allocation to gold, with a smaller holding in bitcoin across client portfolios, but acknowledged that the world’s largest cryptocurrency “has a place in a diversified portfolio.”

Karger suggested restructuring the fixed-income portion of the traditional 60/40 portfolio, which typically allocates 60% to equities and 40% to bonds.

He recommended diversifying away from long-dated bonds in favor of shorter-term debt, real estate, digital assets, gold, and broader commodities such as copper and AI-infrastructure plays.

Gold has been a stellar trade this year, hovering at a record high above $4,060 per ounce. It’s on pace for its best annual return in more than four decades.

“Absolutely, you should own gold,” said Karger. “It’s just a great store of value. Gold has had a 2,000-year history of calling bunk on currencies.”

For those holding physical bullion, he recommended coins over bars, which can be harder to resell, though either form should be stored securely.

Gold futures have risen in nine of the past 10 sessions, setting new all-time highs for 10 straight trading days, an extraordinary run that’s driven year-to-date gains of nearly 55%.