While central banks are increasing gold purchases in the face of an uncertain economic context, Deutsche Bank is drawing an unprecedented parallel with bitcoin. In a published report, the German bank highlights common dynamics between the two assets, traditionally opposed. This analysis questions the place that bitcoin could occupy in official reserves in the medium term.
In brief
- Central banks are sharply increasing their purchases of gold, reaching a level not seen since the 1990s.
- Deutsche Bank points out that gold now represents 24% of official reserves, compared to a much lower average over the last decade.
- This gold rush reflects a loss of confidence in fiat currencies and a return to tangible assets.
- Bitcoin, like gold, has low correlation to traditional assets and declining volatility.
Gold regains a central role in central bank strategies
As gold and bitcoin reach record highs, Deutsche Bank reveals in its latest headline “Gold’s reign, Bitcoin’s rise” that the share of the precious metal in official central bank reserves reached 24% in the second quarter of this year, its highest level since the 1990s.
This level reflects a major strategic change in the management of reserve assets. The bank's analysts note that official demand for gold is now building at a pace “twice the average for the period 2011–2021“.
More than a simple economic rebound, this dynamic is seen as a return of gold to the heart of the logic of financial sovereignty. THE report states that “the renewed accumulation of gold marks a major turning point in global finance, evoking behavior observed during much of the 20th century“.
This resurgence of gold comes even as the yellow metal has just surpassed, in real value, its highest historical peaks reached in 1980, according to inflation adjustments.
Deutsche Bank identifies several factors explaining this late development and the importance of the current moment:
- Decades of massive sales by central banks, particularly in the 1990s and 2000s, which helped to keep prices under pressure;
- Institutional transfer obligations, particularly among certain funds subject to regulatory constraints;
- The lasting effect of the transition to the era of fiat currencies, since the abandonment of the gold standard in the late 1970s;
- The loss of the formal role of gold as a reference asset, recorded in 1979 when the IMF prohibited member states from linking their currencies to gold;
- The gradual return of distrust towards fiat currencies, accentuated by the multiplication of monetary crises and unconventional monetary expansion policies.
In short, gold seems to be resuming a function that it has not officially had for more than forty years. A development which, according to Deutsche Bank, opens the way to new readings on the nature of reserve assets, including digital ones.
Bitcoin: a trajectory that challenges institutions
In the same report, Marion Laboure, macro-strategist at Deutsche Bank, draws an explicit parallel between the dynamics of gold and those of Bitcoin. She note that these two assets have major common characteristics: “low correlation with traditional assets, historically high volatility, although significantly decreasing for Bitcoin, and a role as a safe haven in times of instability“.
According to her, these similarities could pave the way for broader institutional adoption, or even integration into central bank balance sheets.
However, Laboure does not minimize the obstacles that remain. She recognizes that bitcoin remains an asset “leaning against nothing”, which constitutes an ideological obstacle for many institutions. Added to this are technical and economic limitations, such as “the still restricted use, the perception of high risk, the speculative nature, cyber security vulnerabilities and liquidity constraints“. Despite these reservations, Deutsche Bank considers it plausible that bitcoin and gold “can both appear on central bank balance sheets by 2030 ».
If this hypothesis were to materialize, it would mean institutional legitimization of bitcoin, but also a redefinition of reserve assets in an increasingly multipolar world. The growing interest of certain states in the inclusion of BTC in their strategic reserves as evidenced by the recent summit meeting to advance the project in the United States, although marginal for the moment, could accelerate this dynamic.
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