When the CEO of JP Morgan announced that the bank would explore the introduction of a stablecoin, it marked a shift in the zeitgeist. As a long-time crypto sceptic, Jamie Dimon’s change of heart was seen by many as a concession to the ineluctable centrality of blockchain-based technologies to the future of finance.

What about ‘analogue bitcoin’ – aka gold? When Dimon was pressed, in early 2024, on the alleged similarities between crypto and gold, his terse response was that “I don’t own gold either.”

And last month, Dimon expressed concern that surging gold prices could be part of a wider asset bubble, with positive sentiment driving the “highest stock prices ever, highest gold ever, highest crypto ever”.

So it’s notable that Dimon now concedes that there is at least some good reason to hold the yellow metal. “This is one of the few times in my life it’s semi-rational to have some in your portfolio,” Dimon said, while caveating that he was not a gold buyer himself.

Why gold is so hot right now

Why is so much money pouring into gold?

For billionaire hedge fund manager Ray Dalio, among others, gold is a hedge at a time of increased uncertainty. The metal, he says, is more of a safe haven than the US dollar.   

Paul Krugman suggests that policy uncertainty opens up a new world of possibilities, with previously inconceivable doubts about US stability: “I normally pay don’t pay much attention to gold, which doesn’t play an important role in the modern economy. But I believe that the recent runup in gold prices is telling us something — namely, that the world is losing faith in America.”

Not everyone is persuaded. As Marcus Ashworth argues in Bloomberg, although gold is up 50% this year, “that doesn’t mean there’s been a comparable surge in its use as a reserve asset”. Ashworth points out that the USD “still commands the lion’s share of currency trading and global central bank reserves, even if international investors are hedging more exposure”.

The meaning of the moment

So why is gold having a moment?

Central bank buying is part of the equation, though precise numbers may be hard to quantify.

Are investors looking for a safe haven at a time of broad epistemic confusion? Have observers lost faith in US assets? Or is investment in the precious metal driven by FOMO and hype?

Maybe the answer isn’t obvious. Gold’s surge could reflect fear, strategy, or speculation, or something more mysterious about the state of the global order. Whatever the drivers, its rise is telling us something important, even if we’re not yet sure what.

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