Bitcoin is trading at a steep discount to gold and global money supply trends, potentially signalling a reversal higher, according to Jan3 chief executive Samson Mow.
Mow said Bitcoin is between 24% and 66% below its long-term trend relative to gold’s market capitalisation and global liquidity measures, while gold has become “overextended” after April futures closed at $5,247.90 per ounce.
“Bitcoin is about 24%-66% below its trend relative to gold's market cap or global money supply, while gold is overextended,”
Said Samson Mow.
Mow pointed to the Bitcoin-to-gold Z-score, which measures how far BTC’s price deviates from its historical average relative to gold, noting that readings below -2 have historically preceded major rallies and that the ratio currently stands near -1.24.
Data from TradingView shows the metric fell below -3 in November 2022 during the collapse of FTX, after which Bitcoin surged more than 150% over the following 12 months, while a similar drop below -2 in March 2020 preceded a rally of over 300% into late 2021 highs near $69,000.
The bullish thesis contrasts with more cautious forecasts from other analysts who argue heightened geopolitical tensions and investor uncertainty could drive Bitcoin towards $50,000, echoing price action seen during the 2022 bear market.
Bitcoin recently fell more than 50% from its peak to around $60,000 before recovering towards $66,000, leaving traders divided over whether historical ratio signals or macro headwinds will dictate the next major move.
At the time of reporting, Bitcoin price was $65,972.13.