Hedge fund billionaire David Einhorn says gold is increasingly supplanting U.S. Treasurys as the world’s leading reserve asset, reflecting growing unease over America’s fiscal outlook and trade policy, Business Insider reports.

The Greenlight Capital founder argues that central banks are steadily shifting toward bullion as confidence in U.S. debt wanes.

Einhorn pointed to reports that China has encouraged its banks to scale back Treasury holdings, while global central bank gold purchases remain elevated. According to the World Gold Council, central banks bought roughly 863 metric tons of gold in 2025.

“The central banks around the world are buying gold,” Einhorn said, suggesting the metal is now rivaling — or even replacing — Treasurys as the preferred reserve asset.

Einhorn, whose firm has invested in gold for more than a decade, cited two main drivers behind the shift.

First, he described U.S. trade policy as unstable, prompting some nations to settle transactions in alternatives to the dollar.

Second, he warned that America’s growing debt and persistent deficits are eroding long-term confidence in dollar-based assets.

“Our fiscal policies and our monetary policies don’t make any sense,” Einhorn said, calling the U.S. deficit trajectory unsustainable.

While demand for Treasurys has remained solid at recent auctions, concerns about “de-dollarization” have gained traction in recent years.

The trend accelerated after sanctions on Russia in 2022 and has been reinforced by trade tensions and tariff policies, which triggered periodic bouts of “Sell America” sentiment among foreign investors.

In that environment, gold has benefited from what some investors call the “debasement trade” — buying hard assets as a hedge against potential currency weakness.