Bitcoin's ratio to gold has fallen to multi-year lows, reaching levels that historically preceded significant market reversals. The decline comes as investors favor safe-haven assets amid tighter monetary policy and global economic uncertainty.
What Happened: Ratio Decline
The BTC-to-gold ratio, which measures Bitcoin's value relative to gold, has dropped approximately 40% to 45% since mid-2025. As of Dec. 15, the ratio stood at roughly 20 XAU, down from 35 to 40 XAU during the 2021 bull market.
The current level remains above previous bear-market lows of approximately 2 in 2015, 5 in 2018 and 10 to 12 in 2022.
Analyst Michael van de Poppe noted that Bitcoin's relative strength index against gold has fallen below 30, a threshold that typically indicates oversold conditions.
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Why It Matters: Historical Patterns
Van de Poppe said such extreme readings often signal pricing imbalances between assets. "The data suggest that gold may be overvalued relative to Bitcoin," he said, adding that capital rotation into Bitcoin could follow.
A separate analysis using Z-score metrics shows Bitcoin versus gold testing long-term support that has held since 2019.
The Z-score, which measures deviation from long-term averages, has dropped to approximately -1.7, levels previously observed in 2019, 2020 and 2022 before Bitcoin strengthened against gold.
Bitcoin is trading near $86,489, down 0.2% in the past 24 hours.
Van de Poppe said a move above $88,000 would signal positive momentum, while failure to recover that level could push prices toward support at $83,800 and $80,500.
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