Veteran trader Peter Brandt forecasts a major surge in Bitcoin’s (BTC) value compared to gold (XAU), predicting BTC could reach 100 ounces of gold within the next 12 to 18 months.
Currently, it takes 29 ounces of gold to buy one Bitcoin, suggesting Brandt’s prediction could result in a 230% increase in BTC’s value against gold.
Bitcoin has steadily gained ground against gold since its inception. In 2017, Bitcoin surpassed gold in terms of price, peaking at $19,649 on December 17, while gold traded at $1,264 per ounce, requiring 15.5 ounces of gold to buy one Bitcoin.
Despite bearish markets in 2018 and 2019, Bitcoin maintained a higher value than gold, measured in dollars. By December 2018, Bitcoin hit a low of $3,126 compared to gold’s $1,283 per ounce.
In August 2020, amid the economic uncertainty caused by the COVID-19 pandemic, gold reached a new high of $2,075 per ounce, while Bitcoin traded at $12,341.
As of May 2024, gold achieved an all-time high of $2,449 per ounce, and Bitcoin reached $74,000 before settling at $67,619.90 at press time. Gold is currently trading at $2,327 per ounce.
Peter Brandt’s BTC prediction
Peter Brandt anticipates the BTC/GLD ratio will stabilize for 12 to 18 months before a strong upward movement. He predicts Bitcoin could reach 100 ounces of gold, valuing BTC at $234,400—a 243% increase from its current price.
Bitcoin has already gained 42% against gold this year, despite some corrections, showcasing its ongoing outperformance of gold and potential for future growth.
Brandt believes Bitcoin still has room for growth, with the BTC/GLD ratio currently above key moving averages, indicating bullish momentum.
ETF influence and market dynamics
The launch of the first spot Bitcoin exchange-traded funds (ETFs) in the U.S. has significantly influenced both assets. These ETFs have accumulated over $50 billion in assets under management (AUM) in record time, a feat that took gold ETFs five years to accomplish.
BlackRock’s (NYSE: BLK) Bitcoin ETF, the iShares Bitcoin Trust (IBIT), became the fastest ETF to reach $20 billion in AUM, surpassing the Grayscale Bitcoin Trust (GBTC) and now targeting the iShares Gold ETF (IAU), which holds roughly $29 billion in AUM.
Nate Geraci, president of the ETF Store, believes IBIT could surpass IAU by the end of 2024. This rapid growth has bolstered Bitcoin’s status as a leading market indicator.
Despite the success of Bitcoin ETFs, Bloomberg Intelligence’s senior commodity strategist Mike McGlone noted that Bitcoin’s recent surge did not exceed its 2021 peaks against gold and the S&P 500, highlighting the volatile nature of cryptocurrencies compared to traditional assets.
Meanwhile, Kaiko data shows that Bitcoin’s 60-day correlation with gold has been increasing, nearing yearly highs but still below 2022 peaks.
BTC correlation with gold. Source: Kaiko
This suggests that while both assets offer protection against economic uncertainties, investors view them differently, with Bitcoin potentially offering more upside.
Price analysis – Bitcoin vs. Gold
BTC and gold 1 year price analysis. Source :TradingView
Over the past year, Bitcoin exhibited high volatility, ranging from $25,036 to $73,390, achieving a 118% increase. Its relative strength index (RSI) indicated both oversold and overbought conditions, currently standing at a neutral 52. Factors such as the halving event and increasing institutional interest contribute to its optimistic long-term prospects.
Gold, on the other hand, showed steady growth, with a 17.7% increase in price and an RSI of 46, reflecting market balance. It remains a preferred safe haven asset amid economic uncertainties, expected to maintain its stability due to ongoing inflation and geopolitical tensions.
Both assets offer distinctive investment opportunities: Bitcoin for potential high returns and volatility and Gold for stability and risk mitigation
For now, the next target on Bitcoin’s list is silver, which has a total market cap of $1.8 trillion, while Bitcoin sits at $1.33 trillion in value, according to data provided by CryptoRank.
Bitcoin still has a long way to go to catch up to gold, which is estimated to have a total value of $15.5 trillion.
As Bitcoin continues to gain ground and attract investor interest, its performance against gold will be a key metric to watch in the coming months.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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