A report from the Wall Street Journal’s in-house crypto expert, Paul Vigna, has claimed that BTC has begun to trade in step with gold, over the past five days as traditional investors jump into crypto.
Accentuating how Bitcoin is likely the second coming of the orange(ish) precious metal.
Citing data from research firm Excalibur Pro Inc., the WSJ states that the top cryptocurrency has traded at a 0.84 correlation to gold over the past five days, where -1 indicates complete inversion and +1 perfect correlation.
The WSJ gives some clarification as to why this happened on the market. The first thing they say is that in the cryptocurrency market there has been a greater influx of institutional investors.
One of the companies investing in Bitcoin, for example, is Grayscale Investments.
The Journal points to an influx of money coming into crypto investment firm Grayscale as a prime example of new money entering the space.
Grayscale says its Bitcoin Investment Trust has grown from $51 million in assets under management back in 2013 to $3.5 billion at the height of the crypto bull run, and now stands at about $759 million.
Historically, Gold and other precious metals have been the most popular safe haven investments, used by investors and institutions alike to hedge their positions within the equities markets. Many cryptocurrency investors hope, or expect, that Bitcoin will ultimately become a “Gold 2.0” that acts as a digital safe haven investment.