Bitcoin – Gold Ratio Unchanged Despite Bull Rally, Is Crypto Risk Abating?

Mike McGlone, a Senior Commodity Strategist at Bloomberg Intelligence, highlighted the stagnancy of the Bitcoin Gold ratio, even amidst a bull run.

This comes as the BTC price and gold price have recorded impressive boosts in the past few months.

As a result of this outlook, crypto enthusiasts have questions, including whether or not the crypto volatility risk is abating.

Bitcoin and Gold Prices Comparison

Notably, the BTC Gold ratio measures the ounces of gold a single Bitcoin can buy. It is usually calculated by dividing the BTC price by the price of gold per ounce (in USD).

It serves as a gauge of the relative value of Bitcoin as a store of value in comparison with the precious metal asset.

Over time, many investors have referred to Bitcoin as “digital gold,” implying that it plays a similar role as a hedge against inflation.

However, McGlone observed that the Bitcoin Gold ratio has remained 32x for the last four years.

His concerns stem from the reality that the flagship cryptocurrency has recorded massive bull runs and price rallies.

The coin has hit several All-Time Highs (ATHs) since Donald Trump won the United States Presidential election in November 2024.

However, according to McGlone, this was also not sufficient to impact the ratio metric, which has not improved until now.

This suggests that Bitcoin has not been able to successfully leave gold behind in terms of price growth.

However, JPMorgan analysts are suggesting that Bitcoin could soon outperform gold.

For now, as the BTC price in USD is increasing, gold price is also following this trend closely, keeping the Bitcoin Gold ratio stable.

Judging by this sentiment alone, it may be hasty to conclude that crypto risk, which includes volatility and a speculative nature, is abating.

Nevertheless, it is notable that Bitcoin is maturing as an asset class.

Debasing the US Dollar and Implications for BTC Price

Crypto entrepreneur and investor Anthony Pompliano also recently discussed dollar debasement or devaluation.

He shared insights into the current situation of the US economy, citing that government spending is increasing further.

The analyst also highlighted the trend of excessive government spending. He stated that it has remained on the rise across different administrations, even that of Trump.

While this may not be best for the US economy, Pompliano asserted that this USD debasement is beneficial to Bitcoin, gold, and stocks.

Historical data and the current market outlook support this narrative. The author of “Rich Dad Poor Dad” encourages investors to acquire BTC as an inflation hedge.

In this regard, Bitcoin and Gold are not placed as rivals. Rather, they are categorized as assets that appreciate when fiat currency like USD is devalued.

Bitcoin Price and General Market Outlook

At the time of this writing, BTC’s price traded at $109,020.87, following a 0.50% drawdown. With this outlook, Bitcoin is still maintaining its position as the leading crypto asset.

Some long traders, however, have suffered losses from the recent slight decline in the coin’s price.

In the last two days, Bitcoin has exhibited signs of a continued bull run, going from around $107,000 to more than $111,000.

Encouraged by this outlook, traders bet on the coin’s capacity to hit more gains, probably with a push to $120,000.

Unfortunately, the flagship cryptocurrency retracted, causing long liquidations to surpass $100 million in a day.

Still, several Bitcoin Marxists are confident that BTC price will reach fresh highs soon.