Gold High, Bitcoin Rising Fast: Alternative Assets Off To A Hot Start in 2024

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Last Updated on: 10th January 2024, 08:32 pm

Happy New Year! 

Following a blockbuster year on Wall Street, the calendar has finally turned. And so too have the market dynamics affecting retirement investors.

With Bitcoin above $45,000 for the first time in 21 months and gold prices hovering at $2,070 (just $40 below their all-time high), the alternative asset market is red hot to start the year. 

This comes on the heels of a bullish stock market that, according to Ron William of RW Advisory, is ready for a “behavioral inflection point”. The market has priced in no less than six rate cuts in the coming year, and if the Fed fails to deliver on this front we could see rolling waves of volatility across conventional asset markets. 

Market Snapshot: January 3, 2023

• Inflation Rate: 3.1%
• Fed Rate: 5.5%
• Gold Price: $2,070/oz.
• Silver Price: $23.66/oz.
• Bitcoin Price: $44,842/oz.
• Ethereum Price: $2,364/oz.

Amid an increasingly uncertain geopolitical and macroeconomic backdrop, alternative assets, however, are outperforming expectations. 

In the past month alone, Bitcoin has seen a gain of +13.62% while Ethereum, the second-largest cryptocurrency, is trading +9.13% higher against the U.S. dollar. 

Why, then, is the cryptocurrency market booming after two years of near-continuous decline?

For one, the launch of Bitcoin’s first-ever ETFs are nearly realized. Institutional capital is taking interest in these funds, that aim to make cryptocurrency investing more accessible and risk-adjusted than using individual investing. 

Only last week, the SEC received a flurry of S-1 amendment filings from various Bitcoin ETF projects, including from Invesco Galaxy, WisdomTree, and Fidelity. For Invesco, JPMorgan is listed as a key Authorized Participant in the fund. 

While the upcoming launch of several institutionally-backed Bitcoin ETFs has renewed interest in cryptocurrency in recent months, many others have sought out Bitcoin to diversify their holdings amid an increasingly uncertain global financial market. 

This also explains why gold, at least in part, has caught the attention of global investors. 

Investors fear an imminent slowdown in global economic activity, increased logistical instability in the Middle East and Persian Gulf trade routes, and a softening dollar due to a dovish Fed. It’s no wonder why central banks are buying gold at a near-record pace, with 337 tonnes purchased, collectively, by central banks in Q3 2023 alone.

Meanwhile, the world’s fastest-growing international economic bloc, BRICS, just got bigger. 

Yesterday, the UAE, Ethiopia, Saudi Arabia, Iran, and Egypt joined the alliance headed by Russia and China, adding fuel to a fast-changing global landscape that may shift the balance of power away from Western states—and the U.S. dollar. 

On top of the changing geopolitical landscape, monetary policies at home also complicate the economic forecast in the months ahead. Although a dovish Fed pivot has begun, there is still no telling exactly when interest rates will fall and markets will stabilize. 
While the broader macroeconomic environment is shaky, the alternative assets market is thriving. To capture the upside potential of gold, silver, Bitcoin, and other bullish assets, consider investing in a self-directed alternative asset IRA today.