Is Bitcoin Still a Safe-Haven? Not Really, According to Data
Jeffrey Gogo is a journalist with 20 years of experience in business, finance, cryptocurrency, and climate change news and analysis.
Elena is the Features Lead at Cryptonews.com. With a Master's degree in science journalism from City University, London, she is passionate about exploring complex topics in the world of technology.
Key takeaways:
Bitcoin’s reputation as a gold-like store of value has come under the spotlight this year following periods of market uncertainty. The stock market drop on Aug. 5 rippled through crypto markets, sending Bitcoin down 16%. Gold showed more resistance, retreating just over 1%. These flash crashes have happened a few times in 2024, and each time, BTC – often touted as “digital gold” – has come out worse off than real gold.
According to data from crypto research firm Kaiko, Bitcoin (BTC) underperformed gold during the Aug. 5 sell-off. The asset, a proxy for the crypto industry, has become more tied to the stock market instead, particularly to blue-chip technology stocks such as Apple, Amazon, and Microsoft.
The data shows that the BTC to gold ratio, which measures the relative performance of the two assets, dropped to its lowest level in six months on Aug. 5. When the ratio falls, Bitcoin performs worse than gold, and vice versa. The BTC price itself plunged below the psychological $50,000 mark, a rate of decline not seen since the collapse of FTX and Terraform Labs in 2022, leaving the entire crypto industry in limbo.
Adam McCarthy, a research analyst at Kaiko, told Cryptonews by email:
The correlation coefficient measures the relative performance of gold and Bitcoin. Over the past two years, BTC’s correlation to gold has remained “fairly weak.” According to Kaiko, the 60-day correlation
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