Stocks will probably still be good investments, but Bitcoin might be better.
They say absence makes the heart grow fonder, but in markets, scarcity often makes prices grow faster. Investors balking at stretched stock valuations, macroeconomic turmoil, and governments drowning in IOUs have a challenging task ahead: Find an alternative store of value that can still compound wealth.
Enter Bitcoin (CRYPTO: BTC), an asset that offers a respite from inflation, and, thanks to a hearty amount of institutional capital flowing in every week, no longer sits at the fringe. If its fundamentals and adoption trajectory hold, the next five years could tilt decisively in its favor, making holders a lot richer along the way.
Bitcoin’s protocol hard-codes a lifetime limit of 21 million coins. That’s the foundation for its stability against fiat currencies like the dollar, and it’s also one of the main factors that could drive it to outperform against stocks.
Roughly 19.8 million Bitcoins already exist, and April 2024’s halving chopped its supply to approximately 478 coins mined per day. That shrinking trickle of supply contrasts sharply with the macroeconomic backdrop, in which global debt climbed to $324 trillion in the first quarter of 2025, a $7.5 trillion jump in three months.
The repayment of the interest generated by that debt could be a significant drag on growth across many companies and industries, as it’ll reduce the capital they can sock away for the purpose of reinvestment as well as for dividends and share repurchases. And that’s before even taking into account the detrimental impact of issues like inflation, which may be rearing its head yet again as a result of the Trump administration’s global trade war and tariff policies.
Despite facing this uncertainty and the debt overhang, stocks have rarely been pricier. The S&P 500’s price-to-earnings (P/E) multiple hit 28.7 in early June, well above its five-year average, and implying slimmer future returns unless earnings surprise to the upside.
Valuation is not destiny. There are often many reasons why individual stocks are valued richly, most commonly that their fundamentals or business model are so favorable that they can reasonably be expected to outperform the typical business. But when the entire market is looking a bit pricey, that narrative becomes harder to believe, as it implies that everything is going to grow at a moderate to fast clip.
