Jeff Currie, Head of Commodities Research for Goldman Sachs, says the "digital gold" narrative for crypto assets doesn't fit — crypto is more like digital copper, in his view.
During an interview with CNBC Tuesday, Currie said the risk that comes with cryptocurrencies means their value is different from that of safe-haven assets like gold, even though both are something of a hedge against inflation.
"The digital currencies, they're not substitutes to gold," he said. "If anything they'd be a substitute to copper, and I argue that because they're pro-risk."
Bitcoin is correlated to the business cycle, according to Currie, since it's linked to an underlying payment structure. For that reason, it's a better substitute for "risk-on inflation hedges."
These types of inflation hedges, which include copper and oil, hedge against "good inflation," according to Currie, which results from increased demand. Gold, in comparison, hedges against "bad inflation" which results from a change in supply.