---
title: "If gold doesn't rotate, where is the incremental capital supporting BTC?"
type: "Topics"
locale: "en"
url: "https://longbridge.com/en/topics/38050454.md"
description: "Recently, I've been thinking about a question. If geopolitical risks lead central banks to increase their gold reserves (not for trading profits), and this trend is hard to reverse in the short term, then there won't be capital rotation from the gold sector. So how can cryptocurrencies attract incremental funds? Coincidentally, I've been reading ARK's 2026 report these past two days, and Cathie Wood remains a big bull on AI and crypto..."
datetime: "2026-01-23T09:30:14.000Z"
locales:
  - [en](https://longbridge.com/en/topics/38050454.md)
  - [zh-CN](https://longbridge.com/zh-CN/topics/38050454.md)
  - [zh-HK](https://longbridge.com/zh-HK/topics/38050454.md)
author: "[lyhalfway](https://longbridge.com/en/profiles/3372973.md)"
---

> Supported Languages: [简体中文](https://longbridge.com/zh-CN/topics/38050454.md) | [繁體中文](https://longbridge.com/zh-HK/topics/38050454.md)


# If gold doesn't rotate, where is the incremental capital supporting BTC?

Recently, I've been thinking about a question. If geopolitical risks lead central banks to increase their gold reserves (not for trading profits), and this trend, once established, is difficult to reverse in the short term, then there won't be capital rotation from the gold sector. So, how can cryptocurrencies attract incremental funds?

Coincidentally, I've been reading ARK's 2026 report these past two days. Cathie Wood remains a strong bull on AI and crypto. She answered where BTC's incremental funds come from based on its valuation model.

1.  "Rebalancing" of the Global Market Portfolio (Institutional Investment)
    -   There is approximately $200 trillion in institutional asset pools globally (excluding gold), including pension funds, insurance funds, and endowments.
    -   These funds don't need to sell gold; they only need to slightly adjust the traditional 60/40 stock-bond portfolio. ARK predicts that if these institutions allocate just 1% to 6.5% of their assets to BTC, it would bring $2 trillion to $13 trillion in incremental buying power.
    -   In 2025, the inclusion of the Wisconsin Pension Fund and Morgan Stanley's full opening of ETF access marked the beginning of this flood moving from "0" to "1%."
2.  "DAT-ification" of Corporate Balance Sheets (Corporate Treasury)
    -   Funding source: Approximately $7 trillion in corporate cash and equivalents globally.
    -   Logic: Companies no longer just hold depreciating fiat cash but issue bonds or additional shares to acquire BTC/ETH.
    -   Data: In 2025, the number of BTC held by listed companies grew by 73%. This capital isn't "rotation from existing holdings" but "pure incremental purchasing power" created through capital market financing.
3.  "New Allocation" of Sovereign Reserves (Nation-State Strategic Reserves)
    -   Funding source: Approximately $15 trillion in sovereign foreign reserves globally (excluding gold).
    -   Driver: ARK's 2026 report specifically mentions the **"Strategic Bitcoin Reserve" executive order** signed by Trump and actions in places like Texas.
    -   Logic: When a country decides to build BTC reserves, it typically uses foreign exchange surpluses or issues local currency bonds to buy in the open market. This behavior runs parallel to gold reserves, aiming not to fall behind in the "digital sovereignty" game.
4.  "Fiat Flight" in Emerging Markets (EM Safe Haven)
    -   Funding source: Approximately $68 trillion in M2 money supply in emerging markets.
    -   Logic: In high-inflation regions like Turkey, Argentina, and Nigeria, people aren't choosing between "gold and crypto" but between "worthless paper (local currency) and crypto." ARK believes that as stablecoins become more widespread in these regions, this capital will flow in via stablecoins and ultimately support underlying assets (BTC/ETH).

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## Comments (23)

- **小战士就是我 · 2026-01-23T16:46:25.000Z**: Reposting a perspective:Drivers for gold and silver: Stagflation + restructuring of order. The so-called restructuring of order includes geopolitics, but the most important aspects are monetary and financial order. Turmoil in some small countries has little impact on gold and silver. What truly matt
- **埋单退纸巾 · 2026-01-23T13:17:23.000Z · 👍 2**: Everything has its cycle, stocks do, gold does, and cryptocurrencies even more so. This kind of "grand narrative" is like saying that in the long run, everything is bullish, and it applies to any serious stock/gold/Bitcoin. And it's true—currencies keep depreciating, and holding "mon
- **AIUser · 2026-01-23T11:34:24.000Z**: It's so strange that Cathie Wood's report didn't mention BMNR
- **洪福齐天天天 · 2026-01-23T11:22:30.000Z**: Grandpa, I want NVIDIA😭
- **長野原烟花店交易员 · 2026-01-23T09:58:28.000Z**: Believe in the four-year cycle
- **方展博(北京版) · 2026-01-23T09:55:37.000Z · 👍 5**: I think the central bank buys gold to curb dollar hegemony, especially after BTC was incorporated into the dollar system. This is the premise of currency competition. It's not that gold is really worth that much now. The biggest buyer is our Chinese central bank.If metal is used as a monetary equiva
  - **lyhalfway** (2026-01-23T10:06:35.000Z): Well, I also think that the East and Russia are increasing their gold reserves to curb the hegemony of the US dollar, each side has its own anchor.
  - **zoey7** (2026-01-23T10:23:51.000Z): Can someone explain how gold can be used to resolve debt? First time hearing this.
  - **长坂坡滚雪球** (2026-01-23T11:18:29.000Z): Why is it circle instead of Bitcoin?
- **哥哥 · 2026-01-23T09:50:25.000Z · 👍 5**: Why do people still think this round of gold price increase is due to geopolitical risks? Could it be that the excessive issuance of currency and the collapse of the US dollar's credibility are the main reasons? The US dollar is just paper, and other currencies are not even worth that, so countries 
  - **lyhalfway** (2026-01-23T10:02:59.000Z): The collapse of the US dollar's credit is precisely the result of geopolitical risks. It is because the US is no longer willing to bear the costs of maintaining the global system and has chosen to ret
  - **哥哥** (2026-01-23T10:17:48.000Z): I beg to differ. I don't think geopolitical risks and the collapse of the US dollar's credit are causally related. The Russia-Ukraine situation has limited impact on gold. The main global influencers,
  - **lyhalfway** (2026-01-23T10:30:25.000Z): In 2022, the U.S. froze Russia's foreign exchange reserves, turning the U.S. dollar from a neutral clearing tool into a geopolitical weapon. This is why I believe geopolitical risks are the trigger fo
- **柚子梦 · 2026-01-23T09:48:26.000Z · 👍 1**: But the market chose yellow and white, especially when the government shut down in October, thinking they would move together, but the coin stocks came down in just a few days. So the coin probably needs another event to trigger it.
- **渴望复活的我 · 2026-01-23T09:47:38.000Z**: Gold is attracting money like crazy
- **lyhalfway · 2026-01-23T09:36:00.000Z · 👍 1**: @RH brother Gold and BTC may not be substitutes, BTC needs to attract incremental funds
  - **RH哥哥** (2026-01-23T09:39:14.000Z): Let me see👀
- **s3mple · 2026-01-23T09:34:48.000Z**: Such a grand narrative
  - **lyhalfway** (2026-01-23T09:36:28.000Z): Well, ARK's reports are always like this