In January, Bitcoin hit a historically low valuation against gold, as adjusted for the global money supply. This downturn marks one of Bitcoin’s weakest periods relative to gold. Industry experts argue that this scenario presents a more attractive investment prospect than those before the bull market spanning 2015 to 2017. Renewed interest in potentially reallocating capital from gold to Bitcoin underscores the significance of these findings.
Is the Bitcoin-Gold Ratio Signaling a Turning Point?
Bitwise Europe reports that Bitcoin’s value against gold is nearing a historically “extreme weakness” area, similar to previous market lows. The last such instance was recorded in 2015, after which Bitcoin’s price skyrocketed by about 11,800%, climbing from $165 to $20,000 in two years. Prominent analyst Michaël van de Poppe suggests this could be an even more lucrative opportunity than 2017.
André Dragosch of Bitwise Europe and Pav Hundal from Swyftx concur with this outlook. Hundal anticipates that following gold’s significant price rise over the past year, investors might choose to capitalize on these gains and pivot to riskier assets like Bitcoin. A progressive transition from gold to Bitcoin investments could initiate between February and March, but experts advise that this shift will likely be neither sudden nor drastic.
Can Long-Term Holders Steady the Crypto Course?
Even with Bitcoin’s steep fall in January, losing approximately 18% over the year, on-chain data provides a more reassuring view. Long-term investors, those holding Bitcoin for more than 155 days, began to strengthen their positions amid selling pressures. Historical trends indicate that similar patterns of long-term investor accumulation often herald a recovery phase.
Following the lows of April 2025, a swift 60% Bitcoin price recovery occurred within thirty days as long-term investors increased their stakes. This demonstrates that experienced investors often view price drops as strategic buying opportunities, implying that the market is gradually forming a solid base.
However, forecasts are not unanimous. Analyst Benjamin Cowen remains cautious, pointing out that Bitcoin might continue to underperform compared to stocks. He doesn’t foresee a substantial reallocation from gold and silver anytime soon. In contrast, Citi remains optimistic about silver’s rise due to Chinese demand and a weakening dollar, while RBC Capital Markets projects gold prices reaching $7,000 by the end of 2026.
“Given the historical trends, long-term investors have an opportunity for strategic accumulation, potentially laying the groundwork for a market rebound,” said André Dragosch.
The drastic drop in the Bitcoin-gold ratio could represent a long-term opportunity for the crypto market. The length of this opportunity window and the speed of capital movement remain in question. While caution is prudent in the short term, on-chain data and historical cycles provide optimistic signals for those willing to wait.
