Bitcoin increasingly looks like gold rather than a tech investment

Bitcoin is increasingly behaving less like a technology stock and more like gold. That is the conclusion of an analysis by Grayscale. The correlation between Bitcoin and the Nasdaq 100 has fallen over the past ninety days from over 60% to approximately 33%, while the correlation with gold has risen from virtually zero at the start of this year to more than 50%. Grayscale sees this as an indication that investors are once again regarding Bitcoin as a scarce and monetarily independent asset.

Bitcoin is available at OKX and Bybit.

In short:

• Bitcoin’s correlation with gold rises above 50%, correlation with Nasdaq 100 falls to 33%
• Grayscale links the shift to concerns over the US debt pile of more than $40 trillion
• Research director Zach Pandl expects Bitcoin to enter a more favourable market environment

From tech investment to alternative to gold

Over the past year, Bitcoin largely moved in step with risky assets, driven by the AI-fueled optimism in the stock market. In that context, Bitcoin behaved more like a speculative investment than as a protection against monetary risks.

That dynamic now appears to be turning. Grayscale research director Zach Pandl states that the correlation with the Nasdaq 100 has dropped within ninety days from over 60% to around 33%. At the same time, the correlation with gold rose from nearly zero to well above 50%. Pandl says this shift could indicate that investors are once again focusing on Bitcoin’s scarcity, its independence from the monetary system and its function as a store of value.

Rising US debt draws investors towards scarce assets

The macroeconomic context clearly plays a role in this. US national debt recently passed the $40 trillion mark, while yields on long-term government bonds rose sharply over the past year. Earlier, BlackRock also pointed to the role that rising US debt plays as an argument for Bitcoin.

High debt levels, persistent budget deficits and rising long-term interest rates together ensure that investors are actively seeking assets that offer protection against a deteriorating fiscal and monetary situation. This so-called debasement trade, in which investors flee towards scarce assets when currency devaluation is expected, is therefore making a comeback.

Pandl says this could allow Bitcoin and other scarce digital assets to enter a more favourable market environment. At the time of writing, Bitcoin was trading at around $79K, down 0.2% over the past 24 hours.