Bitcoin at $90.40K: Why Macro Strategist Questions BTC Leadership Over Gold Despite Debasement Thesis

The crypto market faces a curious paradox in early 2026. While government debt dynamics and currency debasement remain structurally bullish themes, one prominent macro analyst argues that Bitcoin may not be the optimal vehicle to express this trade right now.

Luke Gromen, founder of FFTT (Forest For The Trees) and author of the Tree Rings macro research product, has maintained his long-term conviction that sovereign debt pressures will push central banks toward inflation and currency weakness. Yet his near-term stance on Bitcoin has shifted noticeably—and his reasoning offers practical lessons for anyone tracking asset performance without blindly following narrative.

The Debasement Framework: Why It Still Matters

Gromen’s core thesis centers on what happens when governments carry unsustainable debt loads. Rather than default outright, they can gradually erode the debt burden by tolerating higher inflation and allowing their currencies to lose purchasing power. The nominal obligation stays the same, but its real value shrinks over time.

This dynamic has historically benefited assets perceived as resistant to unlimited supply creation—primarily gold, and in recent years, Bitcoin. Both are harder to “print” than fiat currency, making them attractive stores of purchasing power in inflationary regimes.

The critical insight is that Gromen does not view this as a short-term tactical play. Debasement operates over years and decades. Pullbacks and corrections within that long cycle do not invalidate the structural thesis. However, structural conviction does not require holding a deteriorating asset through every price action.

Why Bitcoin’s Relative Performance Matters More Than Absolute Price

At $90.40K, Bitcoin sits well above its 2024 lows, yet Gromen’s concern is not about absolute dollar appreciation. Instead, he focuses on Bitcoin’s performance against gold—a more revealing metric for testing whether BTC remains the preferred debasement hedge.

The BTC-to-gold ratio has compressed significantly. To acquire one Bitcoin, investors now need roughly 20 ounces of gold, compared to approximately 40 ounces in December 2024. This deterioration in the ratio signals that market participants are increasingly favoring gold as the primary inflation hedge, at least in the near term.

This shift matters because it suggests that while both assets may benefit from debasement over a decade, the market’s allocation preference has rotated away from Bitcoin for now. In Gromen’s framework, this is not capitulation—it is a practical signal that gold and certain equity segments are expressing the debasement trade more effectively than cryptocurrency at this moment.

Three Operational Signals Worth Tracking Weekly

Rather than rely on anyone’s market call, Gromen advocates a process-driven approach using three mechanical filters:

BTC-to-Gold Ratio: The Primary Hedge Test

Monitor whether Bitcoin is strengthening or weakening relative to gold. A rising ratio favors Bitcoin as the debasement vehicle; a falling ratio suggests gold is winning investor preference. This metric abstracts away from dollar volatility and reveals pure relative strength.

Trend Integrity: The 200-Day Simple Moving Average

The 200-day simple moving average (200D SMA) serves as a widely recognized dividing line between long-term uptrends and downtrends. Breaks below this level do not mean “sell everything,” but rather that the risk-reward profile has deteriorated and warrants reduced exposure or defensive positioning.

Bitcoin’s interaction with this moving average is particularly relevant when combined with poor BTC-to-gold performance. Breaks below the 200D SMA alongside a weakening gold ratio form a two-part warning that the technical backdrop is shifting.

ETF Flows: The Confirmation Layer

US spot Bitcoin ETF flows, tracked publicly by providers like Farside, reveal whether institutional investors are accumulating or distributing. Persistent outflows combined with weak BTC-to-gold ratios and trend deterioration create a “three strikes” setup that justifies reducing Bitcoin exposure—even if the long-term debasement thesis remains intact.

The Case for Tactical Reduction in 2026

Gromen has outlined a scenario in which Bitcoin could move toward the $40,000 range during 2026. This is not a “Bitcoin is dead” call. Rather, it reflects his assessment that current risk-reward does not justify holding maximum exposure.

The primary deterioration drivers he identifies include:

Bitcoin Underperforming Gold: The compression in the BTC-to-gold ratio signals that the relative positioning has shifted. When the leading inflation hedge (Bitcoin) fails to set new records against the traditional hedge (gold), it raises questions about which asset the market trusts more for purchasing power preservation.

Technical Damage: Key moving average breaks remove the cushion that trend-following investors rely on. This does not mean a crash is imminent, but it does mean the technical backdrop has deteriorated and requires vigilance.

Quantum Risk Narratives: Growing discussion around quantum computing and cryptographic vulnerabilities has created an ambient headwind. While practical quantum threats remain years away, the psychological impact of repeated headlines can prompt risk reduction. Bitcoin developers are already debating post-quantum migration paths, and standards organizations like NIST finalized initial post-quantum cryptography standards in August 2024, yet industry adoption will take years.

Separating the Macro Thesis from the Vehicle Choice

The elegance of Gromen’s framework lies in its flexibility. He separates regime conviction (debasement will unfold) from vehicle allocation (Bitcoin is the optimal expression right now).

This means:

• Holding conviction that governments will continue debasing currencies does not require maintaining maximum Bitcoin exposure.
• Trimming Bitcoin does not mean abandoning the debasement trade altogether. Gold, commodities, and certain equity segments can express the same thesis more effectively at present.
• A rules-based rebalancing approach—reducing Bitcoin when the three signals deteriorate, re-adding when they improve—can manage risk without requiring perfect market timing or emotional discipline.

How to Re-Enter Bitcoin: The Reversal Signals

The framework cuts both ways. Bitcoin would deserve re-allocation if:

1. The BTC-to-gold ratio stabilizes and reverses higher, signaling renewed market confidence in Bitcoin as the debasement hedge.
2. Price repairs trend levels, particularly moving back above the 200D SMA in a sustained manner.
3. ETF flows transition from outflows to inflows, confirming that institutional anxiety has eased.

None of these signals need to arrive simultaneously. But convergence of two or three would suggest the tactical downside risk has been absorbed and the risk-reward has shifted back in Bitcoin’s favor.

The Quantum Risk Equation: Timing Versus Real-World Implementation

Quantum risk deserves particular attention because it operates on two timelines: immediate sentiment impact and actual cryptographic migration timeline.

On the technical side, estimates from firms like a16z suggest that cryptographically relevant quantum computers remain unlikely in the 2020s. However, migrating large-scale systems to post-quantum cryptography is operationally complex and takes years. Bitcoin developers, through channels like the Bitcoin-Dev mailing list and Bitcoin Optech tracking, are already proposing and debating migration frameworks.

In practice, this means quantum risk will likely remain a headline-driven sentiment headwind for the next several years, even as the actual technical threat timeline stretches further out. Investors focused on short- to medium-term positioning should factor in this narrative risk, even if the existential cryptographic threat remains distant.

Process Over Prediction

The broader lesson from Gromen’s analysis is that systematic position management beats narrative following. By checking three signals weekly—BTC-to-gold, trend level, and ETF flows—investors can:

• Avoid the trap of “Bitcoin or nothing” thinking while maintaining exposure to the debasement thesis.
• Reduce emotional decision-making by defining clear rules in advance.
• Preserve dry powder to add exposure when valuations and technicals reset.

The debasement trade may well reward patient, long-term holders of Bitcoin over the next decade. That conviction does not require Bitcoin holders to sit through a deteriorating setup without adjusting their positions.

Disclaimer: This analysis is presented for educational purposes and does not constitute investment advice. All investments carry risk. Readers should conduct independent research and consult qualified professionals before making any trading decisions.