Crypto bulls have long advocated Bitcoin as the modern day replacement for gold, and in some ways the emerging market is already close to outperforming gold bars in that regard.

The total value of the cryptocurrency market is now over $ 2 trillion, almost equal to the amount of gold held for personal investment purposes, according to a new report from Bernstein.

“Investors need to find sources of return that can hedge depreciation risk and diversify equity risk as inflation rises. These assets [cryptocurrencies] could have the potential to perform this function, “the company said in a statement to customers on Tuesday.

Crypto has caught on thanks to support from corporations and institutional players, and investors are increasingly viewing digital currencies as a reliable store of value and a way to diversify portfolios. Bitcoin, the largest cryptocurrency, was trading at around $ 43,300 on Tuesday, which translates into a market capitalization of around $ 800 billion. This is based on data from Coin Metrics.

However, Bernstein was quick to notice that both gold and digital currencies have other uses. When gold jewelry is included in the equation, Bernstein’s calculations suggest that the precious metal’s market value is closer to $ 8 trillion, roughly four times the size of the crypto universe.

In addition, there are important differences between cryptocurrencies. Bernstein said Bitcoin is mainly used as a store of value, while other digital currencies like Ethereum cannot be held just as an investment.

Bernstein’s appeal echoes comments from major money managers who have pointed to the ease with which Bitcoin is traded, making it potentially more attractive than gold as a safe haven and hedge against inflation.

“It’s easy to carry and can be sent anywhere in the world using a smartphone, so it’s a much better version than gold as a store of value,” said Bill Miller, founder and chief investment officer at Miller Value Partners CNBC in April.

“It [bitcoin] is so much more functional than passing a bullion around, “noted Rick Rieder, chief investment officer, global fixed income, BlackRock.

Nevertheless, questions about the long-term profitability of Bitcoin remain open, also from a regulatory and ecological point of view. Bitcoin prices fell last week after Elon Musk, Tesla CEO, said the company stopped accepting cryptocurrency as vehicle payment due to the “rapidly increasing use of fossil fuels to mine bitcoin”. Musk later clarified Monday that the company had not sold any of its bitcoin positions, which were first reported in February to be valued at $ 1.5 billion.

Looking ahead, Bernstein’s Harshita Rawat said she believes Bitcoin can displace gold once some of the regulatory and environmental questions are answered.

“Bitcoin can be more easily used as a store of value in any part of the world (especially countries with unstable fiat currencies) and is very liquid,” she noted, referring to the cryptocurrency’s 24-hour network and near-instant transactions. “The effects as a store of value, especially in certain countries / regimes, are significant.”

She said bitcoin and cryptocurrencies had generally “reached a tipping point” in terms of “institutional / retail adoption, dollar investments, industry talent and liquidity.”

However, Rawat’s colleague Inigo Fraser-Jenkins is less sure of how investors will ultimately see Bitcoin in the long term. Among other things, he pointed to the 5,000-year history of gold compared to investors who only recently saw Bitcoin as being able to maintain its value.

He argues that it will be many years before Bitcoin can build enough trust to make it a real safe haven. “Very broad economic, legal and cultural problems play a role here. Any claim that these can be overcome in a short period of time seems difficult to accept given their deep social character,” he said.

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– CNBC’s Michael Bloom contributed to the coverage.