“Diversification means not putting all your eggs in one basket” is one of the oldest rules in finance — and one of the least understood. Too many investors diversify across asset classes that are, in truth, driven by the same underlying forces: debt, liquidity, and confidence in fiat currency. When confidence erodes — as it invariably does at key turning points in history — that’s when you need true diversification. That’s where gold and bitcoin come in.
Over the past several years, we have thoroughly analysed these two assets not as speculative instruments, but as complementary pillars in a modern Sound Money Portfolio. Gold, with its six-thousand-year track record, owns the “store of value” franchise. Bitcoin, with only 15 years under its belt, brings the disruptive power of a digitally native, high-beta hard asset. Invested together, they create a powerful barbell that offers protection on one side — and convex upside on the other.
In a world awash in debt (global debt >350 % of GDP), gold retains its role as the ultimate collateral — an asset with no counterparty risk. Since the turn of the century, central banks have swung from net sellers to net buyers. In fact, since 2022 we have witnessed the strongest official sector gold buying spree in modern history, with emerging market central banks steadily diversifying away from the US dollar. Gold now makes up a higher share of global FX reserves than the euro — a symbolic but highly important shift.
Despite this tailwind, gold continues to trade at a deep discount relative to monetary aggregates and financial assets. When measured against the global money supply or the market cap of equities, gold’s “coverage ratios” remain close to multi-decade lows. Put differently: gold has a lot of catching up to do.
While gold shines through millennia, bitcoin compresses innovation into dog-years. Since its creation in 2009, bitcoin has evolved from a curiosity to a strategic reserve asset with a distinct use-case: digitally transferable, programmable property with extreme scarcity baked into its code (21 million cap).
As our proprietary BTC Compass research framework shows, bitcoin is increasingly being valued as a macro asset — not a tech trade. Its correlation with liquidity cycles, real rates, and monetary policy expectations continues to strengthen. Like gold, bitcoin tends to flourish when trust in fiat systems wobbles. Unlike gold, bitcoin reacts swiftly and with far greater upside convexity — making it such a powerful complement.
Portfolio simulations over the past decade show that even a modest allocation to both gold and bitcoin significantly improves risk-adjusted returns:
· Gold reduces volatility and provides downside protection during crises.
· Bitcoin enhances upside during liquidity waves and reflationary episodes.
· Together, they create a more balanced return stream over the entire economic cycle.
Put simply: this is about building portfolios that are prepared for monetary regime shifts. As we enter an era of fiscal dominance, geopolitical fragmentation, and structural inflation pressures, this resilience is not a luxury — it’s a necessity.
At Incrementum, we have been managing specialised, gold-bitcoin strategies for over five years. Our experience navigating multiple bull and bear cycles — in both assets — has only strengthened our conviction: the future belongs to portfolios built on robust fundamentals, not media narratives.
Our BTC Compass helps us actively adjust bitcoin positioning across macro-regimes, while our gold allocation is rooted in valuation models we’ve refined over nearly two decades through the In Gold We Trust report.
To conclude, in a world where cash is being diluted, bonds are broken, and the traditional “60/40” model is running on fumes, the most prudent thing an investor can do is to anchor their wealth in hard monetary assets. Gold is the bedrock. Bitcoin is the accelerator.
Why choose between them — when the true power lies in the combination? There’s no rivalry between them, but a remarkable complement.
👉 Ready to dive deeper? Subscribe to our BTC Compass and to the IGWT Monthly Gold Compass – if you haven’t done so – for exclusive insights into bitcoin’s macro cycles and to gold’s enduring strength.
🌐 Visit Incrementum AG to explore how our investment boutique helps investors build robust portfolios with our gold & bitcoin solutions.
💬 Or feel free to message us directly to discuss portfolio strategies — always happy to exchange views on Sound Money 2.0.
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