Bitcoin (BTC) finally outperformed gold by a wide margin this week, after a long period where gold has performed significantly better than its digital cousin.
The outperformance of gold by bitcoin came during what has been a strong week for the digital currency, which has moved from just over USD 19,000 on Monday to USD 21,800 as of Friday at 14:48 UTC – a gain of about 13%.
Over the same time period, gold has lost around 3.4%, after dropping sharply on Tuesday and Wednesday this week. The price of the traditional safe haven fell from USD 1,809 on Monday to USD 1,747 at the time of writing.
Bitcoin (blue line) vs. gold (orange line) this week:
The outperformance of gold by bitcoin this week came after the yellow metal for most of this year has proved to be a significantly better investment than ‘digital gold’.
Year-to-date performance of bitcoin (blue line) vs. gold (orange line):
It remains unclear whether the outperformance this week marks the beginning of a bigger move higher for bitcoin, given that the macro outlook largely remains the same. However, some observers have argued that the rise for bitcoin this week came as a result of most of the deleveraging in the broader crypto market already being over.
“We’ve had this massive deleveraging, and I think most of that deleveraging is now out of the system,” Mike Novogratz, CEO of Galaxy Digital, told CNBC on Thursday.
Notably, the weekly outperformance happened despite signals from June that the two assets over the course of the month had become more correlated.
The increased correlation “signals a broader trend of correlations between all asset classes rising amidst significant macroeconomic uncertainty,” crypto exchange Kraken commented in its monthly market recap for June.