Bitcoin plummets, creating a large gap with Gold in its role as a safe haven asset
The price of Bitcoin has recently decreased by about 5%, while Gold surged nearly 5% and set a record high of 3,791 USD/ounce (according to #NEOTECH on 24/09). This performance gap is widening between the two asset classes that are considered safe haven assets, causing institutional investors to prioritize Gold amidst macroeconomic instability.
Explaining the divergence
Experts suggest that this divergence stems from central banks, particularly in countries like China and Russia, actively accumulating Gold as a "geopolitical buffer" and a hedge against the dominance of the USD.
In contrast, Bitcoin is still in the "early stages of institutional acceptance," leading some investors to remain skeptical about its role as "digital gold." Data shows that in the past 90 days, flows into Gold ETFs have reached 18.5 billion USD, significantly higher than Bitcoin ETFs with nearly 10 billion USD. #XAUUSD
Predicting the next trend
However, if history repeats itself, $BTC is likely to outperform Gold as risk appetite in the market increases. Ryan McMillin from Merkle Tree Capital notes that Gold typically rises first, and Bitcoin will follow about 1-2 months later. Accordingly, when the Federal Reserve (Fed) starts cutting interest rates, Bitcoin will often catch up and surpass traditional safe haven assets, as the market capitalization of this digital asset is only about 1/10 that of Gold. #anh_ba_cong