Bitwise Reports Bitcoin Could Double with 5% Gold Investment Shift
Recent developments indicate a decline in gold's valuation following its rally, while Bitcoin is experiencing capital rotation towards it, recovering to the $112,000 mark.
Gold's Influence on Bitcoin
- A report by Bitwise outlines positive price prospects for Bitcoin despite recent challenges.
- Crypto prices have underperformed traditional assets due to bearish market sentiment and weaknesses in US regional bank stocks.
- Bitcoin's performance against gold varies with cross-asset risk appetite. A risk-on environment could boost Bitcoin's performance over gold.
- Gold's rise is driven by expectations of easier monetary policy and US fiscal debt concerns.
- Even a 3% to 4% capital shift from gold to Bitcoin could significantly increase Bitcoin's value.
- A 5% investment shift could raise Bitcoin's price by over 126%, reaching $242,391 from a baseline of $107,240.
Importance of the $118,000 Level for Bitcoin
- Bitcoin may reassert performance leadership during a risk-on phase, as seen in 2020.
- Sustaining gold's rally requires more capital than Bitcoin, potentially hindering gold's continued performance.
- On-chain analysis shows a liquidity cluster between $93,000 and $118,000, marking a boundary between bull and bear markets.
- A move above $118,000 could trigger a new price rally for Bitcoin.
