The day after Russia launched its full-scale invasion of Ukraine, gold jumped to its highest price in more than a year, reinforcing its reputation as a safe haven for risk-averse investors in times of war, inflation and currency collapse.

By comparison, Bitcoin fell as much as 9 percent in a day following Russia’s Feb. 24 invasion. It was down 22 percent from two weeks earlier. Bitcoin proponents have long promoted the No. 1 cryptocurrency as a form of “digital gold” that would act like gold.

Pierre Lassonde, chairman emeritus of Toronto-based gold-focused royalty and streaming company Franco-Nevada Corp., presented a scenario for the price of gold hitting $10,000.

The longer the Russia-Ukraine conflict lasts, the more profound the impact is going to be, particularly on the energy market, said Lassonde, who is the CEO of Firelight Investments. If the conflict continues for a month, “I think you’re looking at $200 oil,” Lassonde told Michelle Makori, editor-in-chief of Kitco News at the BMO Global Metals & Mining Conference. Medium-term, gold is headed towards $2,200 to $2,400 an ounce, Lassonde predicted. Long-term, over the next five years, if the Dow Jones contracts by 20-to-30 percent, the Dow-to-gold ratio could converge to 2:1, he said. This would imply a $10,000 gold price.

As Russian soldiers invaded Ukraine, gold prices reached a session high of $1,976.50 an ounce, the highest in 1.5 years. Gold was trading at $1,931.20 as of this writing.

Russia’s central bank said that it would resume buying gold on Feb. 28 on the domestic market as it tries to find financial stability during the barrage of Western sanctions over the invasion of Ukraine. Russia’s gold reserves total 2,298.53 tonnes, according to World Gold Council.

The Russian stock market collapsed by more than 50 percent and the ruble went into freefall on Feb. 24 after the Moscow Exchange resumed trading following a two-hour suspension. One Russian ruble equals $0.0097 USD as of this writing.

Goldman Sachs analysts predicted that gold could hit $2,150 in the coming months and play a central role in the conflict as Russia turns to the precious metal for leverage amid sanctions, Kitco reported. “Gold’s unique role as the currency of last resort will likely be apparent if restrictions on Russia’s central bank accessing its offshore reserves leave it leveraging its large domestic gold stockpiles to continue foreign trade, most likely with China,” the bank said.

Goldman Sachs is estimating seven interest rate hikes in 2022 by the U.S. Federal Reserve and another four in 2023 to fight inflation. The first is expected on March 16. Raising its inflation outlook, Goldman said that it is “increasingly concerned” about the pace of inflation in 2022. “A very high inflation path in 2022 should make an easy case for steady rate hikes at all seven remaining” Federal Reserve meetings in 2022, said Goldman economist David Mericle in a note to clients.

Gold bug and crypto skeptic Peter Schiff was declared the winner of a debate in August 2021 on whether gold is a better store of value than Bitcoin. Schiff debated former White House Director of Communications Anthony Scaramucci, the founder of Skybridge Capital, in a debate hosted by Intelligence Squared. Scaramucci argued that Bitcoin’s value is derived from its network which enables peer-to-peer transactions without a third party. It has advantages over gold, Scaramucci said, because of its scarcity, its digital properties, its portability, the fact that its transaction are on the blockchain and its rapid adoption. He predicted that prices will go a lot higher, Cointelegraph reported.

Schiff described Bitcoin as a “Ponzi scheme,” a “giant pump-and-dump” and “tulip mania.” He argued that Bitcoin is fraudulently marketed to look like a gold coin but it doesn’t have any of the “metallic properties“ that give gold value. “You put like a ‘B’ on it but it’s not a coin, it’s just a digital string of numbers. It doesn’t have any substance,” he said. While gold’s value is determined by real-world use cases, Bitcoin doesn’t have tangible backing in the real world, Schiff said.

MicroStrategy CEO Michael Saylor, whose company started accumulating Bitcoin in August 2020 and says it now holds about 125,051 Bitcoins at a cost of almost $3.8 billion — insists Bitcoin is a good investment amid geopolitical uncertainty. On Feb. 24, the day before Russia’s full-scale invasion began, Saylor tweeted, “Nation state conflicts create uncertainty, constrain production, weaken currency, cripple trade, and undermine credit, making investments in debt & equity riskier and underscoring the benefit of converting treasury assets into pure digital energy. #Bitcoin.”

Listen to GHOGH with Jamarlin Martin | Episode 74: Jamarlin Martin Jamarlin returns for a new season of the GHOGH podcast to discuss Bitcoin, bubbles, and Biden. He talks about the risk factors for Bitcoin as an investment asset including origin risk, speculative market structure, regulatory, and environment. Are broader financial markets in a massive speculative bubble?

The Virginia-based firm is now thought to own more Bitcoin than any other corporation in the world, bought at an average price of $30,200 per coin.

Bitcoin was trading at $43,121.80 as of this writing.

“Playing gold as a geopolitical safe haven” involves risks, wrote Neils Christensen, an editor for Kitco, which is a retailer of bullion products with a media division that provides news about bullion products. “The problem with that gold play is if geopolitical uncertainty doesn’t escalate, then the momentum can’t be sustained,” Christensen wrote. “We have seen this scenario numerous times in the last decade, and gold has ended up lower than where it began. While you shouldn’t chase gold on one geopolitical conflict, that doesn’t mean it is not an effective safe-haven asset. Instead of focusing on the day-to-day volatility, investors need to view gold from a long-term perspective.”

Inflation and rising prices don’t appear to be going away, Christensen wrote,” and we don’t know how this is going to end … Gold is one of the last pillars of safety in the global financial market. It has no correlation to equities and has no counter-party risk, making it an important diversification tool … As frustrating as gold’s daily price action can be, it still remains an important asset for investors.”