Cathie Wood, the CEO of ARK Invest, has highlighted a notable trend in investor behavior, suggesting that Bitcoin (BTC) is increasingly being seen as a substitute for gold as a store of value. Wood’s remarks come in the wake of the launch of spot Bitcoin exchange-traded funds (ETFs), which have facilitated easier access to Bitcoin for investors.
During a recent conversation with chief futurist Brett Winton on ARK Invest’s YouTube channel, Wood observed, “Relative to gold, Bitcoin has been rising. There’s now a substitution into Bitcoin and we think that is going to continue now that there is a less friction-filled way to access Bitcoin.
Wood drew parallels between Bitcoin and gold, noting their roles as “risk-off assets” particularly during periods of weakness in the banking sector. She cited the March 2023 “regional bank crisis” in the United States, highlighting Bitcoin’s price surge of 40% amidst the turmoil while the Regional Bank index faced significant declines.
An analysis by Fidelity further corroborates Wood’s observations, revealing that Bitcoin’s correlation with gold notably increased in 2023. This trend marks a departure from Bitcoin’s previous inverse relationship with interest rates, despite global rate hikes. The one-year rolling correlation between Bitcoin and gold currently stands at 0.80, marking the highest correlation recorded between the two assets.
ARK Invest was among the 10 ETF issuers that introduced a spot Bitcoin ETF on January 11, known as the ARK 21Shares Bitcoin ETF. Since its launch, the ETF has accumulated over $700 million worth of Bitcoin, establishing itself as one of the largest Bitcoin ETFs available in the market.
Wood’s insights underscore the evolving perceptions of Bitcoin as a viable alternative to traditional stores of value like gold, particularly as the accessibility and adoption of cryptocurrencies continue to expand within the investment landscape. As investors navigate shifting market dynamics, the role of Bitcoin as a store of value is increasingly being recognized and integrated into investment strategies.
