Legendary macro trader Paul Tudor Jones called Bitcoin (CRYPTO: BTC) “unequivocally, the best inflation hedge that there is” and argued it beats gold on scarcity value with its fixed 21 million supply cap.

Why Bitcoin Beats Gold As Inflation Hedge

Jones, founder and CIO of Tudor Investment Corp., made the case for Bitcoin on the Invest Like the Best podcast Tuesday, pointing to its finite supply as the key differentiator from gold.

“Gold increases supply every year by a couple of percent. Bitcoin, there’s a finite amount that can be mined. It’s decentralized. And so in that sense, it has the greatest scarcity value of anything,” Jones explained.

Bitcoin has less than 1 million BTC left that can be mined out of its 21 million fixed cap.

Jones first advocated for owning Bitcoin as a hedge against central bank money printing in 2020, confirming he held between 1% and 2% of his assets in Bitcoin at the time. A year later, he wanted to allocate 5% of his assets into the cryptocurrency.

The 2020 Inflation Trade Setup

Jones recalled that following substantial fiscal intervention by the Federal Reserve and U.S. Treasury in 2020, the inflation trades were clearly going to take off.

“And what was, of all of them, what was the best one at that point in time? It was bitcoin,” Jones noted.

The hedge fund manager looks for knockout opportunities when markets become stretched, imbalances persist, or policymakers make mistakes. 

He searches for something underowned, undervalued, way out of whack where people have gotten complacent, then waits for the catalytic moment.

The Cyber Warfare And Quantum Risks

Jones acknowledged Bitcoin’s weakness would emerge in a kinetic conflict involving cyber warfare, where anything electronic goes down including Bitcoin.

He also flagged quantum computing as a longer-term risk with AI advancing rapidly. Someone could potentially hack any bank and anything they want once quantum computing arrives.

“Who knows if and when, with AI advancing as fast as it is, we may actually have quantum computing,” Jones cautioned.

Bitcoin Chart At Critical Junction

Bitcoin is consolidating inside the rising channel after last week’s push toward $79,500. 

The 200 EMA at $82,303 sits just $5,600 away. BTC has been within striking distance for a week without committing. 

The Supertrend at $71,629 continues stepping higher week by week.

Support sits at $75,545 (20 EMA), then $73,593 (50 EMA), then $71,629 (Supertrend). Resistance clusters at $79,500 (channel top), then $82,303 (200 EMA).

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