Bitcoin is not in its “digital gold” period, according to Ki Young Ju, the CEO and founder of the analytics company CryptoQuant. CryptoQuant looks at data from the crypto markets to help people understand what is happening with prices and trading. The idea of Bitcoin as digital gold means some people think Bitcoin could act like gold in a digital world — a way to store value over time. Bitcoin is the first decentralized cryptocurrency, which means it is a form of money not controlled by a single government or bank.
When we look at how Bitcoin and gold move in price, we can see why this idea matters. The two assets did not always behave the same way. Correlation is a word that describes how two things move together. If two prices rise or fall at the same time, they have a positive correlation. If one goes up while the other goes down, they have a negative correlation. Correlation is a simple way to measure this connection between two variables. (For beginners: think of two friends who regularly go to the same places. If they go to the same place at the same time, they are like a strong, positive correlation.)
From 2022 to the middle of 2024, Bitcoin and gold were mostly green together. This green color in charts means the two were moving in a similar direction most of the time. In simple terms, they tended to go up and down together during that period.
Then things started to change. By the end of 2024, after the United States presidential elections, Bitcoin and gold moved in different ways. The correlation between them turned red for the first time in years. In stock and crypto markets, red usually signals that two things are moving in opposite directions. During this time, Bitcoin rose to new peaks while gold did not rise as fast. This showed that Bitcoin was not following the same pattern as gold anymore.
As gold began to catch up later, the connection between Bitcoin and gold rose again. By the third quarter and the early fourth quarter of 2025, the correlation between the two crossed 0.5. In statistics, a correlation above 0.5 is a noticeable link. It means the two prices were moving more or less in the same direction again. But another big change was coming in the wider crypto market. While gold kept growing and catching up, the crypto market faced serious trouble.
On October 10, Bitcoin experienced one of its most painful daily corrections. In a 24-hour period, the entire market saw large liquidations. More than $19 billion worth of positions were liquidated. A liquidation means a trader’s position is closed because the trader did not meet the required price level, usually causing losses to be realized for many traders at once. (Liquidation is the process of ending a business or position and selling off its assets to pay debts. Learn more.)
Since that day, Bitcoin has not recovered to its former highs. The price has continued to move lower and was around $63,000 at the time this was reported. In other words, Bitcoin is still about 50% away from its peak price in prior months. This shows how quickly sentiment in crypto markets can change and how difficult it can be to return to earlier highs after a big drop.
Gold took a different path. It reached a new all-time high of $5,600 at the end of January. After that peak, gold briefly dropped to around $4,400 but quickly recovered and has mostly stayed above $5,000 since then. Today, gold trades roughly around that level, remaining a strong asset in many markets. The official market activity also reflects this strength. Gold’s market capitalization — the total value of all gold in circulation measured by its price times the amount available — has risen into the trillions, and its current level is reported to be north of $36.1 trillion.
Putting Bitcoin and gold side by side, the difference in size is striking. The gap between their market performance and value is often described in terms of market capitalization. In simple terms, market capitalization compares how much money would be needed to buy all available units of an asset at its current price. Market capitalization is the total value of a publicly traded asset, such as a company or a commodity, calculated by multiplying price by the amount available. The article notes that gold’s market value is far larger than Bitcoin’s, a spread that researchers describe as a roughly 30x difference in market cap. This means gold is much larger in total value when you look at the whole market, not just the price of one ounce. (For reference: Gold is a chemical element with symbol Au (aurum), a dense, malleable and precious metal.)
What does this all mean for the idea of Bitcoin as digital gold? The headline from CryptoPotato about this topic says that the narrative of Bitcoin acting like digital gold is failing again. In plain terms, the story that Bitcoin will behave exactly like gold in the long run is not proven by what happened in the last few years. The relationships between Bitcoin and gold have become inconsistent. Sometimes they move together; other times they do not. The big price swings in Bitcoin in 2024 and 2025 show that it can be very different from gold when bad news hits or when big events happen in the market.
So, what should a reader take away from all this? First, it is important to understand that both Bitcoin and gold are used by people to protect against different kinds of risk. Gold has a long history as a store of value, not easily destroyed or lost. Bitcoin is newer and more volatile, but it has a growing following among investors who believe it can offer unique benefits in a digital economy. Second, the idea of Bitcoin as digital gold may still matter to some investors, but it is not a guarantee that Bitcoin will always behave like gold or keep its value in the same way gold does. Third, the market can change quickly. A sharp fall on one day can lead to a long period of adjustment, as happened after the October 10 events. Finally, it helps to learn and ask questions. Understanding terms like correlation, market capitalization, and liquidation can make it easier to read market news and to see why prices move the way they do.
Definitions
- Bitcoin — Bitcoin is the first decentralized cryptocurrency. Wikipedia
- Gold — Gold is a chemical element with symbol Au (aurum), a dense, malleable and precious metal. Wikipedia
- Correlation — Correlation is a statistical relationship between two variables describing how they move in relation to each other. Wikipedia
- Market capitalization — Market capitalization is the total value of a publicly traded company’s outstanding shares. Wikipedia
- Liquidation — Liquidation is the process of bringing a company to an end, with its assets redistributed to creditors and shareholders. Wikipedia
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