Bitcoin–Gold Correlation Hits One of Its Highest Levels in Years
Key Takeaways
- •Bitcoin's 90-day correlation with gold has reached approximately +0.50, the highest since 2020 and more than double its level at the start of the year.
- •Bitcoin's 90-day correlation with the Nasdaq 100 has fallen to roughly +0.30, its lowest level in the past year.
- •The strengthening Bitcoin-gold correlation accelerated after the US Treasury announced on August 19 it would raise the minimum for long-term bond repurchases from $2 billion to $4 billion per transaction.
- •Investors are increasingly treating Bitcoin and gold as similar hedging assets amid concerns over rising public debt and currency depreciation.
- •US spot Bitcoin ETFs launched in January 2024, giving traditional asset managers regulated exposure and boosting the 'digital gold' framing of Bitcoin.
Bitcoin’s (BTC) correlation with gold has climbed to one of its highest levels in recent years, while its relationship with technology stocks has weakened considerably.
According to data cited in The Kobeissi Letter, based on an analysis by Bitwise Asset Management using Bloomberg data, Bitcoin’s 90-day moving average correlation with gold has risen to approximately +0.50. That figure marks one of the highest levels observed since the pandemic in 2020 and is more than double the level recorded at the beginning of the year.
By contrast, Bitcoin’s 90-day correlation with the Nasdaq 100 index has dropped to approximately +0.30, its lowest level in the past year. The data suggests that Bitcoin has recently decoupled from technology stocks and begun exhibiting price behavior more similar to that of gold.
The Kobeissi Letter observed that the strengthening correlation between Bitcoin and gold accelerated after the US Treasury Department announced on August 19 that it would raise the limit for long-term bond repurchases from a minimum of $2 billion to $4 billion per transaction.
According to the analysis, investors are increasingly treating Bitcoin and gold as similar hedging assets amid concerns over rising public debt and currency depreciation. The simultaneous decline in Bitcoin’s correlation with the Nasdaq and rise in its correlation with gold also points to a growing market tendency to price Bitcoin not merely as a risky technology asset, but as an alternative store of value.
The shift comes as the “digital gold” framing of Bitcoin has gained institutional traction since the launch of US spot Bitcoin exchange-traded funds in January 2024, which gave traditional asset managers regulated exposure to the cryptocurrency. Gold, meanwhile, has drawn renewed attention as a debasement hedge amid elevated US fiscal deficits and continued central bank gold buying reported by the World Gold Council. Whether the Bitcoin–gold correlation persists or reverts, as it has after previous episodes of convergence in 2020, remains an open question for market watchers.
*This is not investment advice.
