Bitcoin (BTC) is on track to join gold as a recognized reserve asset within the decade, German lender Deutsche Bank (DBK) said in a report Monday, though the precious metal will likely keep its lead in official holdings for now.

The U.S. dollar still makes up 57% of global reserves, the report noted, but signs of diversification are emerging. China’s U.S. Treasury holdings fell $57 billion in 2024, and momentum for crypto regulation is building in major markets.

Deutsche Bank argues that bitcoin and gold will continue to coexist as complementary hedges against inflation and geopolitical risk, thanks to their scarcity and low correlation to other assets.

Gold hit a record high of $3,763 on Monday. The precious metal has risen over 40% year-to-date.

Crucially, bitcoin’s volatility, long an obstacle to reserve status, is dropping, the bank’s analysts said. Its 30-day volatility hit historic lows in August, even as prices broke records above $123,500, suggesting the cryptocurrency may be decoupling from its speculative past.

The bank said neither bitcoin nor gold is likely to dethrone the dollar, as governments will act to protect monetary sovereignty.

Deutsche Bank sees bitcoin’s adoption following a path similar to gold’s, moving from skepticism to widespread acceptance, with regulation, macroeconomic trends and time paving the way.

As investors continue seeking alternatives to traditional assets, bitcoin could evolve from a speculative bet into a legitimate pillar of the global financial system, the report said.

Read more: Gold Rallies an Hour After Bitcoin Drops, Suggesting a Profit Rotation Into Metals