Since its launch, Bitcoin’s market capitalization has surged an astonishing 350,000%, far outpacing its traditional safe-haven competitor, gold. Recent indicators suggest that Bitcoin (BTC) could be on the cusp of another significant price surge, indicating renewed strength relative to the precious metal.
### Bitcoin’s Potential to Outperform Gold by 2025
The BTC/GLD ratio chart serves as a comparative tool for assessing the performance of these two assets. Changes in this ratio can indicate Bitcoin’s adoption trajectory in relation to gold. A rising ratio signifies that Bitcoin is outperforming gold in market capitalization and vice versa.
Renowned market analyst Peter Brandt suggests that the Bitcoin-to-gold ratio could increase by over 400% by 2025, driven by a classic technical pattern known as the inverse head-and-shoulders (IH&S). This pattern emerges when the price forms three successive troughs, with the central trough—referred to as the head—being deeper than the other two, which are the left and right shoulders. The formation occurs beneath a common support line known as the neckline.
According to technical analysis guidelines, the IH&S pattern is confirmed when the price breaks above the neckline, ideally accompanied by an increase in trading volume. This breakout can lead to a price increase equivalent to the maximum distance between the neckline and the deepest point of the head.
BTC/GLD weekly ratio chart. Source: Peter Brandt
When applying this technical framework to the BTC/GLD ratio chart, the projected target for Bitcoin’s value is approximately 123 ounces of gold by 2025. This would represent a rise of over 400% compared to the current value of about 24 ounces as of September 22, 2024.
### Bitcoin ETF Market Anticipated to Reach $220 Billion
The notion of Bitcoin eclipsing gold has gained traction due to its swift adoption, particularly among institutional investors, along with the introduction of Bitcoin exchange-traded funds (ETFs), which have significantly enhanced Bitcoin’s visibility in investment strategies.
Since January 2024, the approval of Bitcoin ETFs has attracted over $17.69 billion in investments, with forecasts suggesting that this market could expand to as much as $220 billion by 2027, using gold ETFs as a reference point.
Related:
The first gold ETF took two years to reach $10 billion; this Bitcoin ETF accomplished the same in just two months.
Additionally, industry experts such as Anthony Scaramucci believe that Bitcoin will eventually surpass gold’s market capitalization within the next decade, highlighting BTC’s advantages, including its scarcity and portability.
This article does not provide investment advice or recommendations. Every investment and trading decision carries risks, and readers should conduct their own research before making choices.