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Bitcoin ETFs versus Gold ETFs. That's an odd comparison!

At first glance, comparing Bitcoin ETFs to Gold ETFs might seem odd. Bitcoin operates much like equities as a risk asset, susceptible to market fluctuations and investor sentiment. On the other hand, gold has long been considered a traditional store of value and a safe haven during turbulent times, owing to its relatively stable value and physical tangibility.

However, the distinction between these two asset classes is precisely why this comparison is necessary. Some proponents argue that Bitcoin is akin to a digital form of gold, pointing to its finite supply and the mining process. Yet, unlike gold, Bitcoin’s market performance remains closely tied to the vicissitudes of the public securities markets.

While it's tempting to speculate about Bitcoin's future role as a digital counterpart to gold or even as a globally accepted currency, current evidence suggests its behaviour remains too interconnected with traditional risk assets to serve as a true safe haven.

This chart aims to illustrate these differences and similarities. Enjoy!

Source: Charles-Henry Monchau

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