**Bitcoin: The New Digital Gold?**
In recent years, the message has been that bitcoin (BTC) is an excellent way for investors to protect themselves against economic troubles such as inflation or even war. However, since the beginning of the bear market, this narrative lost some of its strength. After all, the bitcoin price fell much further than other assets that were seen as safe havens, such as gold.
At the moment, however, we see that BTC is in a serious recovery mode, and the correlation with the ultimate hoarding asset gold has skyrocketed.
## Bitcoin vs. Gold
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According to the blockchain analysis firm Glassnode, the banking crisis in the United States and Europe has played into the hands of bitcoin. Trust in the traditional banking system was, and is, far from strong, and for that reason, investors are looking for alternatives.
Traditionally, gold has always been a perfect fit for this. It has been the hoarding asset of choice for investors worldwide for many years. We are, however, currently seeing that bitcoin is also being included in the search for such a financial safe haven.
For this reason, the correlation between bitcoin and gold has also risen enormously in recent times. This correlation basically means how closely the prices of BTC and gold are linked. With a negative correlation, the price of bitcoin would do the opposite of the gold price, and with a positive correlation, they would move in the same direction.
### Is Bitcoin the new “Digital Gold”?
The correlation remained weak in the first few months of 2022, but things started to change when the bear market became really stubborn. In the past twelve months, the correlation indicator of Glassnode has mostly shown high positive values, indicating that the two assets have become strongly interconnected during this period.
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Gold was traditionally regarded as a relatively safe investment, while stocks and cryptocurrencies such as bitcoin were generally seen as very risky investments. Now that the correlation between bitcoin and gold has been strongly stoked again, it seems cautiously clear that we can speak of the new “digital gold” when it comes to bitcoin.
Investors may be looking for a viable alternative in the face of uncertain economic and political conditions. Bitcoin, with its scarcity and decentralized nature, may be the perfect digital asset to fill this gap. As the economy continues to evolve, it may become increasingly clear that bitcoin is playing a more prominent role in global financial markets.