Bitcoin Set to Surpass Gold Amid $34T BlackRock Shock to Fed
Bitcoin has staggered into 2026, struggling amid a gold price surge that has propelled it to a staggering $34 trillion market capitalization. The price of bitcoin, which fell below $100,000 per coin in November, has faced challenges in recapturing its early 2025 momentum, especially following a stark $6 trillion warning from the CEO of Bank of America. As bitcoin and the broader crypto market brace for a potential “massive” shock, Rick Rieder, the fixed income chief at BlackRock and a proponent of bitcoin, has emerged as an unexpected frontrunner for U.S. president Donald Trump’s selection for Federal Reserve chair. “I believe [bitcoin] will largely replace gold? Yeah, I do, because it’s so much more functional than passing a bar of gold around,” Rieder told in 2020, adding, “I think bitcoin is here to stay.”
“Rick Rieder’s odds of being next Fed chair have increased dramatically,” stated Geoff Kendrick. “He will run the economy hot, which should benefit crypto.” In 2023, BlackRock, the largest asset manager globally, took the lead in Wall Street’s push for bitcoin and crypto adoption, driving efforts to launch a comprehensive bitcoin exchange-traded fund. BlackRock’s bitcoin ETF has surged to become one of the fastest growing ETFs in history since its launch in early 2024, now holding nearly 800,000 bitcoin valued at $70 billion for its investors. In September last year, Rieder expressed his belief that the bitcoin price is “going to go up,” recommending that investors hold bitcoin alongside gold to provide “a little bit of ballast in the portfolio against potential for currency depreciation.” Concerns over additional currency depreciation have intensified the debasement trade in recent months, driving the gold price closer to $5,000 per ounce, as investors have also flocked to silver.
Trump has been hinting at his choice for the current Fed chair Jerome Powell’s successor for nearly a year, tossing around various names and leaving traders in suspense. In a recent interview, Trump remarked that Rieder was “very impressive.” Trump stated “I’d say we’re down to three, but we’re down to two. And I can probably tell you, we’re down to maybe one, in my mind.” Former Fed governor Kevin Warsh is currently leading the pack, as indicated by Kalshi and Polymarket contracts. This comes after the previous frontrunner, Kevin Hassett, who served as Trump’s national economic council director, has been effectively eliminated from contention. Anticipations surrounding a significant drop in interest rates in 2026, contingent on Trump taking over from Powell, have bolstered bitcoin, crypto, and equity markets in recent months. Trump has consistently stated that his choice for Fed chair must commit to substantial interest rate reductions.
“Undermining the Fed’s independence makes holding the greenback a less attractive safety play,” stated Samer Hasn. The narrative surrounding the “politicized dollar” presents a long-term bullish outlook for the crypto markets, despite the current price declines. “If investors lose faith in U.S. government debt and the Fed’s autonomy, decentralized assets like bitcoin and ‘hard’ assets like gold, which has already seen skyrocketing prices, become the logical hedge against institutional decay.”
