Similar to a currency pair, the Bitcoin-to-Gold ratio captures the value of one BTC in ounces of gold. On 20th January, 2025 it shot up from a high of 34 ounces in November to reach 37.3 — a new peak. The change meant one BTC could buy more than 37 ounces of the precious metal.

The ratio now sits about half a point north of the level reached during the height of crypto’s last full-scale bull run in November 2021. At that time, it reached 36.6.

An analysis published by Coinglass said the milestone ‘signals that traditional finance continues to see Bitcoin as a mature asset class. The ratio has grown in part due to the steady rise on Bitcoin ETF inflows. BTC is increasingly seen as a necessary component of a modern balanced portfolios.’

The ratio is calculated by dividing the current price of Bitcoin by the spot price of a single ounce of gold. Analysts and investors use it to compare the relative strength of the two assets, as well as associated investor demand.

In a note to investors, Analysts at QCP Capital said the rising ratio cements perception of Bitcoin as a kind of ‘digital gold,’ which investors are increasingly turning to as a reliable store of value.’

The note does warn however that traders tend to shift back to gold whenever Bitcoin enters a period of uncertainty. That effect may be more muted in future as BTC’s volatility now tends to correlate with traditional markets, thanks in no small part to the SEC’s approval of Bitcoin exchange-traded funds this year.

The last big shift in preference from gold to Bitcoin took place in October 2022, when investors reacted positively to a period of gold-price market correlation.

Analysts at Bank of America Securities (BofAS) published a report saying that the world’s number one cryptocurrency had been tracking gold prices for an extended period, strongly indicating that investors had been using it as a hedge against broader market volatility.

To be considered a safe haven, a financial asset must be able to shield portfolios from steep losses during an economic downturn. That requires them to be uncorrelated or negatively correlated from trends in the wider economy. Gold has traditionally played this role, providing a sturdy store of value in times of trouble.

The relationship between BTC and gold has historically been used to measure investor confidence in Bitcoin’s store-of-value credibility. Both moved broadly in parallel between June 2021 and March 2022. There was always a level of deviation, but the correlation turned negative in April of that year.

If two or more assets demonstrate a positive correlation, they can be assumed to be responding to the same market stimuli. If they demonstrate a negative correlation, then the opposite is likely true.

At the end of August 2022, the relationship between gold and BTC returned to positive. Then in early October the correlation wound even tighter, touching the highest point seen in the previous twelve months.

Within that time frame, Bitcoin’s relationship to the S&P 500 and Nasdaq 100 indices of blue-chip equities also reached all-time highs, though BoAS analysts said that correlation had begun to slip.

‘A slowing positive correlation with blue chip stocks and a quickly rising correlation with gold tells us that investors have started looking at bitcoin as a relative safe haven to shield portfolios from macro uncertainty and wait for the market bottom to materialize.’