CME Group’s Chief Economist Calls Bitcoin An ‘Emerging Competitor’ to Gold

Recently, Bluford Putnam, Managing Director and Chief Economist at CME Group, said that Bitcoin is an “emerging competitor” to gold. 

Putnam is “responsible for leading global economic analysis and monitoring developments in the price patterns, volatility and correlations of futures and options markets.” Before joining CME Group, Putnam “gained more than 35 years of experience in the financial services industry with concentrations in central banking, investment research and portfolio management.” 

In a video on the YouTube channel of Bloomberg Markets & Finance, Putnam said gold’s production would increase in the coming year, putting it in stark contrast with Bitcoin’s fixed and limited supply. The World Gold Council estimates 2,500 – 3,000 metric tonnes of gold will be mined each year, in addition to the 197,576 tonnes that have already been excavated. 

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Putnam cautioned viewers that Bitcoin’s fixed supply, set at 21 million coins, did not equate to less market volatility. Instead, he called the limited supply a catalyst for significant price movements:

“Shifting patterns with demand can have very large and abrupt impacts on prices, bitcoin has illustrated this point.“

Putnam then commented on gold’s declining appeal as a universal hedge against inflation and global unrest: 

“In the 2017-2020 period, the mostly ups and occasional downs of the gold price appeared to be directly tied to [U.S. Federal Reserve] policy shifts more than anything else.”

Putnam called Bitcoin an “emerging competitor” to gold, while noting the precious metal had a precipitously close relationship with global equities. 

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