- The Bitcoin price fluctuations of the last few weeks once again call into question the narrative that Bitcoin is digital gold.
- Inconsistent ETF flows and market reactions show that Bitcoin has to prove its status as a safe investment from time to time.
Bitcoin’s status as digital gold is questioned by ETF specialist Nate Geraci. He said the asset has not yet proven that it can safely hold its value. He explained further that Bitcoin behaves more like a risky, unstable investment than a safe option, which worries many investors.
Geraci emphasized that Bitcoin’s performance during market declines is crucial. He pointed to the “tariff tantrum” in April, when Bitcoin rose while stocks fell, which briefly supported the digital gold thesis. Later, as tech stocks recovered, Bitcoin fell more than the market, undermining investor confidence.
Geraci said Bitcoin has more than doubled since the start of 2024 but is still over 25% below its all-time high. He explained that weakness in the stock market caused the crash and high leverage in cryptocurrencies exacerbated the losses, showing BTC’s volatility.
Is Bitcoin a “safe haven”?
Bitcoin’s age is not a factor in its credibility. According to Geraci, at 15 years old, Bitcoin is a teenager compared to gold, still learning financial discipline and money management.
Market sentiment is mixed. BTC spot ETFs have had billions of dollars in outflows recently. According to Geraci, many investors remain uncertain about how to approach Bitcoin and whether it can become a profitable long-term investment.
Some institutions believe that wider adoption and inflows into BTC ETFs will strengthen Nitcoin as a currency. JPMorgan predicted that Bitcoin could overtake gold as the leading store of value next year.
Despite this optimistic outlook, Geraci warns that BTC still needs to demonstrate its long-term reliability before it can earn the title of “digital gold.”
Binance founder and ex-CEO Changpeng Zhao cited the advantages of Bitcoin over gold. Geraci mentioned that the price of BTC could behave like gold in the future. However, he also pointed out that the current high volatility is a problem.
The current debate highlights Bitcoin’s mixed record. Strong upswings show the potential, while downswings show the vulnerabilities. Before Bitcoin can become a trustworthy store of value, a longer history across more market cycles than exists to date is required.
Currently, BTC is trading at $89,876, down by 1,24 % in the last 24 hours. The market capitalization is $1.79 trillion, with a 24-hour turnover of $53.94 billion. The current amount of Bitcoin in circulation is 19.95 million BTC – out of a maximum possible 21 million BTC.
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