Gold is experiencing its longest losing streak in over a century, marking a 10-day consecutive decline – its worst run since February 1920, according to Bloomberg analyst Katie Greifeld. The precious metal has plunged as much as 27% from its January all-time high, finding support at its 200-day moving average around $4,090. While it has rebounded approximately 2% in the past 24 hours, likely ending the streak, gold remains down roughly 12% since the escalation of Middle East tensions in late February.
In stark contrast, Bitcoin, often dubbed 'digital gold,' is holding firm above the $70,000 level. This performance has pushed the Bitcoin-to-gold ratio to just below 16 ounces per BTC. The ratio bottomed near 12 ounces just before the recent geopolitical conflict, meaning Bitcoin has outperformed gold by roughly 30% from those lows.
Charlie Morris, Chief Investment Officer at ByteTree, provided historical context: "I remember the excitement when 1 BTC first surpassed one ounce of gold in March 2017. Since then, it has consistently built higher lows, reaching 2.7 oz in 2019, 3.4 oz during the 2020 pandemic crash, 9.1 oz after the FTX collapse, and 12.4 oz in February this year. Now, one BTC is worth 16 ounces of gold. With gold appearing exhausted, we could reasonably expect a new all-time high above 40 ounces in the coming months or years."
Morris noted that historically, Bitcoin tends to lag gold in market cycles, with gold leading an initial rally before consolidating, which then allows Bitcoin to catch up and ultimately outperform.
The divergence is further highlighted in investment flows. Bloomberg ETF analyst Eric Balchunas argues that Bitcoin and gold are not inversely correlated but largely uncorrelated. He points out that gold exchange-traded funds (ETFs), such as the SPDR Gold Trust (GLD) and iShares Gold Trust (IAU), have seen billions of dollars in outflows over the past week. Conversely, U.S. spot Bitcoin ETFs have recorded around $2.5 billion in net inflows this month alone. Year-to-date, these Bitcoin funds have seen only about $140 million in net outflows, despite Bitcoin's price being down roughly 20% over the same period.
