Crypto can’t beat gold as an inflation hedge, says Barrick boss

The world’s second-biggest gold miner is confident prices will hold firm this year, if not rise, as investors use the metal rather than cryptocurrencies to hedge against inflation and jewellery demand picks up.

“The risk is on the upside,” Barrick Gold Corp CEO Mark Bristow said in an interview in Riyadh, Saudi Arabia. “I don’t think there’s very much risk on the downside.”

The mostly likely scenario is that gold trades between $1 750 and slightly above $1 800 an ounce, he said. Spot bullion gained 0.4% to $1 809 by 8:45 a.m. in London, paring its loss this year to 1.1%.

Bristow, a geologist who’s lead Barrick since early 2019, is more bullish than analysts, many of who forecast gold will drop as the US Federal Reserve raises interest rates this year. Its price will average $1 683 per ounce in the fourth quarter, according to a Bloomberg survey of analysts and economists.

Gold’s status as a store of value when inflation accelerates has taken hit since the coronavirus pandemic struck. The metal fell 3.6% in 2021 even as inflation rates across the developed world soared with governments and central banks keeping fiscal and monetary policies loose to stimulate their economies.

Bullion faces growing competition from Bitcoin and other cryptocurrencies that are increasingly pitched to investors as a modern-day gold and an effective hedge against inflation. Goldman Sachs Group argued that Bitcoin is taking market share from gold as a store-of-value investment.

“Look at gold and its precious nature — you can’t print it and you can’t make it,” Bristow said. “You can make cryptocurrencies, and there are many of them. When you’re in a dynamic phase like we’re in now and the world’s uncertain, it’s always good for gold.”

Bristow is in Riyadh to attend Saudi Arabia’s first major mining conference. The Toronto-based company digs up copper in the east of the kingdom in a joint venture with the State miner Maaden.