Looking back at asset performance in the first half of 2023, Bitcoin has continued to outperform gold since the U.S. banking crisis. In recent months, the decoupling of Bitcoin from gold has increased. The analysis mentioned that the reversal of the long-term risk aversion trend has emerged, and the market may begin to prefer crypto assets rather than precious metals as a hedge against inflation.

After the bear market phase in 2022, Bitcoin rebounded in 2023, spurring a 50% year-to-date (YTD) price increase. Notably, this bull run has increased its value relative to gold. According to a June 14 tweet from on-chain analytics firm Glassnode, it takes 13.3 ounces of gold to buy one Bitcoin, a 46% increase since the beginning of the year.

While that's a far cry from the peak ratio of 37 reached during the 2021 bull run, it reflects a massive 430% increase from the lows during the COVID-19 pandemic.

After analyzing the price trajectory of the two assets from the beginning of the year to date, it is found that Bitcoin, which is regarded as "digital gold", has performed better than real-world gold in all aspects. It can be found that Bitcoin has risen by 50% so far this year, but gold has only recorded a 6.4% increase since the beginning of the year.

In the long run, Bitcoin's growing value relative to gold means that the market may begin to prefer crypto assets over precious metals as a hedge against inflation. This could strengthen Bitcoin's long-term support as an alternative to traditional safe-haven assets.

Safe-haven assets are those whose value is expected to remain stable or rise during an economic downturn. Bitcoin proved its strength during the U.S. banking crisis in March and has since risen 21%. Gold, on the other hand, has only risen 4% since the start of the turmoil.

However, investors should take this development with a grain of salt given Bitcoin’s reputation as a volatile asset. As the broader cryptocurrency market suffers from a hostile regulatory environment in the United States, the gains Bitcoin has made this year could quickly reverse.

Bitcoin and gold remain “isolated”

In recent months, Bitcoin’s decoupling from gold has increased. According to Glassnode data, as of June 14, the Bitcoin/gold correlation fell to 0.17, a significant retracement from April’s multi-year highs.

This means that Bitcoin is viewed as an independent asset class with its own fundamentals, rather than being impacted by real-world headwinds.

Bitcoin ushered in a wave of rebound and the price of the currency rose all the way and stabilized at $25,584. From a technical perspective, the bulls are eager to enter the market at the bottom. After many rejections, iShares, a subsidiary of asset management giant BlackRock, officially submitted documents for a Bitcoin spot ETF to the US Securities and Exchange Commission, which will lay a greater market foundation for the Bitcoin market and promote the recovery of bullish sentiment.

The rebound comes after bitcoin plunged late Wednesday amid ongoing concerns about overexpansion in U.S. central bank monetary policy and growing regulatory scrutiny of cryptocurrencies in the U.S. Bitcoin recently rebounded to $25,584, up nearly 2% in the past 24 hours.

Ethereum also surged above $1,660, up 0.8% from the same time on Wednesday. Other major cryptocurrencies turned green from the negative territory they occupied for most of Thursday, with Solana smart contract platform Solana token SOL recently rising 1.8%, SAND and AXS also rising more than 1%, while Polygon blockchain's native cryptocurrency MATIC fell more than 4%.

Interestingly, these assets are among the 19 mentioned in the SEC’s lawsuit alleging that exchanges Binance and Coinbase violated securities laws.

Brian D. Evans, CEO of Web3 Ventures and advisory firm BDE Ventures, noted investor concerns about an increasingly hostile crypto environment in the U.S. “I feel like we are at the beginning of a major shift where project founders are looking for bases outside of the U.S.,” he wrote.

He added: “In that sense, the market feels very confused. In the US, they are scratching their heads over the complexity of a regulatory system that has not been updated since the Great Depression. This failure has prompted projects to look for jurisdictions with better regulation, such as Hong Kong, Dubai and the UK.”

He went on to note that “a global reshuffle is taking place, and the next wave of innovation and market boom is taking shape, centered around Asia and the Middle East. In that sense, I think the digital asset ecosystem is actually getting stronger, making the fireworks that may follow the next Bitcoin halving all the more surprising to a large number of observers. In short, yes, the bullish sentiment is there, but it is increasingly driven by events happening abroad.”

Here is CMTrade’s daily Bitcoin technical analysis:

Bitcoin is still fluctuating around $25,584. Colombia's central bank, Banco de la República, will work with the Ministry of Information and Communications Technology (MinTIC) to pilot Ripple's CBDC platform to improve its high-value payment system.

Looking at the 4-hour chart, the low bullish momentum reversed and rose, and the bullish sentiment was strong. There is a trend of continued upward movement in the short term. The MACD indicator is in the bearish zone, and the RSI indicator is in the bearish zone.

Resistance: 25785 25985

Support levels: 25253 25046

Trading strategy: Bullish above 25454, target 25785 25985