Before the recent price correction, the Bitcoin price has been pushing towards new heights over 10,300 USD and trying to hit a new highest price point this year. In the new decade, Bitcoin has been experiencing a strong push upwards helping all the Altcoins, specifically XRP, along to push their price limits. Because of this, the correlation between gold and Bitcoin has been questioned recently.
The trend that has been noted in the crypto community overall opens up doors for a longer period of value growth as the last prolonged period for Bitcoin price increase has been recorded in April and June of last year. The price volatility that has been observed in recent times has been a reason to challenge the assumptions that have been traditionally held about Bitcoin and large digital assets in general. A largely-held belief is that Bitcoin and gold have a strong connection. However, according to a recent analysis by a crypto news outlet, Cointelegraph, the myth that Bitcoin can be considered as digital gold because of a strong correlation to gold, despite being widely held by investors, is not very realistic. Considering that Bitcoin and gold have had a low price and returns correlation across the years, it is not hard to see why the idea that the first digital currency and gold have a strong relationship is challenged. This is also true about the myth that silver and Litecoin (LTC) have a correlation.
If we actually take into account the relation between the top 10 biggest crypto assets by market cap and gold in January of this year, we can see that XRP has comparatively a stronger relation to gold. While the correlation between Bitcoin and gold is slightly over 21 percent, the correlation of XRP with gold is more than 34 percent. Interestingly, Tether has a negative correlation of -37 percent with gold. If we consider 2019 as our time frame, the correlation of Bitcoin and gold is only 15 percent. On the other hand,XRP and gold had a correlation of only 7 percent last year.