Pal: Bitcoin, Not Gold, Is Top Debasement Hedge

Raoul Pal, co-founder of Real Vision, has stated that Bitcoin (BTC) is a superior long-term hedge against currency debasement compared to gold. He argues that Bitcoin's earlier stage of adoption provides more growth potential than the precious metal.

The comparison was made by Pal in a September interview on the Wolf Financial Show. During that conversation, he outlined his broader perspective on how debasement gradually diminishes savings and wages.

Debasement Erodes Savings Every Year

Pal contends that debasement is the primary driver of rising asset prices over the long term. He links this phenomenon directly to liquidity cycles, which are mainly controlled by central banks and governments.

He defines debasement as the gradual erosion of a currency's purchasing power, occurring as central banks increase the money supply.

According to his estimates, this process lowers the value of fiat currencies worldwide by approximately 8% each year. He also notes that wages generally rise in line with economic growth, around 3%.

Pal argues that this disparity explains why homes and other limited assets have become increasingly unaffordable for average workers. According to BeInCrypto data, Bitcoin was recently trading near $75,900, a decline of roughly 2% over the previous day.

Pal's Reasoning for Bitcoin Outperforming Gold

Pal characterizes gold as base money that cannot compound in value beyond what the overall economy already accounts for. He states that Bitcoin acts as digital gold, offering the same scarcity but with a significantly earlier adoption curve.

He summed up the concept succinctly.

[T]he digital gold is Bitcoin, but Bitcoin’s earlier in its adoption.

The comment was made during the same interview.

According to Pal, only two asset categories have consistently exceeded the debasement rate: cryptocurrency and technology stocks, as measured by the Nasdaq.

He highlighted the Nasdaq's approximate 19% annual return over a 15-year period. Crypto, he estimates, has compounded at an annual rate between 45% and 110%.

He stated that gold, real estate, and other conventional assets generally only match the debasement rate rather than outperform it. Pal's remarks reflect a broader perspective among macro investors, who are increasingly connecting Bitcoin's price movements to gold as the debasement trade picks up momentum.

It remains uncertain whether Bitcoin can maintain its adoption trajectory. The renewed strength of gold could influence how investors evaluate the two assets through 2026.