Bitcoin Struggles to Outpace Gold Despite Institutional Growth

Bitcoin (BTC) has yet to break away from gold despite its increasing institutional adoption, according to veteran trader Peter Brandt. The leading cryptocurrency, often touted as digital gold, has not significantly outperformed the precious metal, a development Brandt called "very surprising."

Bitcoin ETFs have been a major success in 2024, attracting institutional capital and strengthening BTC’s position as a store of value. However, the Bitcoin-gold ratio has dropped by more than 19% since reaching a local high of 41 ounces on Dec. 17. Last week, it hit its lowest level since early November, falling short of Brandt’s prediction of 89 ounces as the next key level.

Meanwhile, gold has surged, nearing a new all-time high. Currently trading at $2,827 per ounce, it briefly hit a record $2,886 on Feb. 7. Since bottoming at $2,583 on Dec. 19, the metal has gained over 11%. Gold’s strong performance raises doubts about Bitcoin’s ability to replace it as the dominant store of value.

Bitcoin advocates, including former Meta executive David Marcus, have urged the U.S. government to replace gold reserves with BTC, arguing its historical returns are superior. However, Bitcoin has struggled to maintain a decisive lead over gold in the past four years.

Despite BTC’s growing mainstream adoption, the comparison to gold remains relevant. The recent price trends indicate that gold continues to hold its ground as a reliable hedge, while Bitcoin faces challenges in asserting itself as the ultimate safe-haven asset.