Data released by the exchange in the past few hours showed that gold had its worst first quarter in 39 years, while bitcoin (BTC) achieved double-digit growth for the sixth consecutive month, the longest monthly gain since 2013.

While gold and bitcoin are often seen as inflation hedges, institutions may now see BTC as a better way to store value. In the past, market participants were reluctant to own gold rather than BTC because few understood its asymmetric upside and its utility as a high-level reserve of value. Although neither can provide revenue, BTC's total addressable market far exceeds gold's $11T market value. In today's era, almost all aspects of our lives have changed from analog to digital, and its utility is greater.

Many market participants may also have realized that BTC, as an emerging inflation hedge, has broad prospects, rising potential, utility and relevance in both traditional financial markets and crypto markets. As more and more people are familiar with digital assets, we can expect BTC to seize market share from risky assets such as junk bonds and stocks, and from risky assets such as gold. This rotation has happened. Last month, the correlation between BTC and gold fell to its lowest level in 52 months, as BTC announced its third highest first quarter in history and gold's worst in 39 years.

(2021-4-10)