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Fidelity's Head of Global Macro Says Bitcoin May Have Place in Some Portfolios

"Is it any wonder that bitcoin seems to be having its day?" Fidelity's global macro chief said.

Mar 1, 2021 at 5:39 p.m. UTC
Updated Sep 14, 2021 at 12:19 p.m. UTC

The bullishness shown by Fidelity Investments' cryptocurrency-focused arm appears to be spreading to the rest of the investments giant, with Director of Global Macro Jurrien Timmer now comparing bitcoin directly to gold.

  • Timmer told investors in a February research note that bitcoin may be emerging as a legitimate hedge against inflation and stable store of value as a form of "digital gold." "In my view, bitcoin has gone mainstream."
  • What's noteworthy here is Timmer is not part of the investment giant's digital assets arm that is, almost by remit, disposed to be pro-crypto. Instead, he's part of the broader company and his pro-bitcoin report speaks to the cryptocurrency's increasingly warm welcome on Wall Street.
  • Grappling with how to model the cryptocurrency, Timmer noted that, if evaluated against simple supply and demand metrics, demand continues to grow "exponentially" while supply remains fixed. That scenario does not apply to gold, whose annual production has remained steady over time. "Bitcoin supply, by design, is finite."
  • He said the monetary environment naturally favors bitcoin. "With interest rates close to zero – or negative – and central banks printing money like there's no tomorrow, is it any wonder that bitcoin seems to be having its day?"
  • While Timmer admitted bitcoin's risks – including volatility – may not amount to a "prudent" investment choice for all, he said it could nonetheless find a home in the bonds slice for certain portfolios. "For those investors, the question of bitcoin may no longer be 'whether' but 'how much?'"
  • He also said that he expects bitcoin "over time" will take more market share from gold.

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