In the digital asset world, the only legitimate rival to Bitcoin other than Ethereum is often considered to be gold. Until now, many analysts and experts continue to make comparisons between these two assets, especially to see what price Bitcoin could trade at if it had a market capitalization similar to that of gold.
Speaking on a similar topic, Peter Brandt, a trading guru with decades of experience in the trading space, recently said shared He focused his analysis on the ongoing rivalry between bitcoin and gold, and ranked them as contenders for the coveted title of “ultimate store of value.”
Notably, the insight shared by Brandt was not just about market capitalization or investor preference; it was specifically based on the core functionality and underlying values of each asset.
Bitcoin vs Gold
Delving deeper into this insight, it is worthwhile to understand the nuances of comparing BTC to gold — a “classic safe-haven asset.” Brandt’s recent investigation on the Bitcoin-to-gold ratio provides an important metric for this comparison.
He highlighted that the current ratio is 26, which indicates that Bitcoin, despite its volatility, is in a stronger position than gold.
Related reading: Is Bitcoin set for a price surge in September? What traders need to know
Brandt points out that this ratio can fluctuate widely, and could possibly drop to as low as 16 depending on market dynamics, which would have little effect on Bitcoin’s potential to go up much in the long term.
Peter Brandt’s analysis goes beyond mere speculation. He emphasizes the importance of flexibility in investment strategies, especially when it comes to volatile assets like Bitcoin and stable assets like gold.
The “store of value” battle is historic
The BTC/Gold chart is a textbook example of classical charting principles
Flexibility of interpretation is more important than dogma
Currently on 26.x, $btc Could fall significantly against Gold (could, won’t) without it dropping to 16… pic.twitter.com/gduy0fTRtE– Peter Brandt (@PeterLBrandt) August 1, 2024
According to Brandt, the main conclusion from his analysis is that the BTC/gold ratio is likely to change significantly. For example, although the ratio could see a short-term decrease, Brandt’s long-term outlook suggests it could rise to 150 or even higher.
This approach is not just about advocating for bitcoin, but about advocating for a balanced investment approach. Brandt advises investors to hold both bitcoin and gold, and highlights the benefits of diversification. By investing in both, traders can mitigate the risks associated with the volatility of cryptocurrencies and the often slow-moving gold market.
Brandt said:
I believe in owning both gold and bitcoin, being dogmatic about one or the other is foolish
BTC and Gold Market Performance
Meanwhile, Bitcoin has been bearish over the past week, falling 7.1% over the past 24 hours and roughly 14.8% below its March high of over $73,000.
Related reading
This negative price performance of the asset has now forced BTC to currently trade at a price of $62,642 at the time of writing.
Gold, on the other hand, has seen a surge in the past week. The asset is currently trading at $2,424 – slightly behind its previous new all-time high (ATH) of $2,483 on July 17.
Featured image created by DALL-E, chart from TradingView
