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Cathie Wood Claims Investors Are Going From Gold to Bitcoin In Response to New ETF Launches

Bitcoin is stealing the shine of gold

Investors are increasingly favoring Bitcoin over gold, a trend that has gained momentum with the advent of spot Bitcoin exchange-traded funds (ETFs), observes Cathie Wood, CEO of ARK Invest. In a recent discussion on ARK's YouTube channel, Wood shared insights into this shift, stating: 

"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." 

This transition is underpinned by the introduction of more accessible investment vehicles, such as spot Bitcoin ETFs, which have made Bitcoin a more attractive option for those looking to diversify their investment portfolios away from traditional assets like gold.

Spot Bitcoin ETFs: a catalyst for change in financial landscape

The launch of spot Bitcoin ETFs has been a vital moment, catalyzing the shift from gold to Bitcoin among investors. Cathie Wood highlights the importance of these ETFs in making Bitcoin accessible, likening its potential to gold as a "risk off asset," especially in times of banking sector instability. 

This was evident in March 2023, during the U.S. regional bank crisis, which saw Bitcoin's price surge by 40%. Wood's analysis is supported by a Fidelity report showing an increased correlation between Bitcoin and gold in 2023, marking a significant departure from Bitcoin's previous inverse relationship with interest rates.

Bitcoin’s correlation with gold and investment dynamics

The investment landscape for Bitcoin has shown remarkable resilience, with its correlation to gold reaching new heights. According to Longtermtrends, the one-year rolling correlation between Bitcoin and gold now stands at 0.80, the highest recorded level. Despite a temporary 20% dip in Bitcoin's price following the launch of a spot Bitcoin ETF, Cathie Wood remains optimistic. She pointed out that

 "15 million of the 19.5 million Bitcoin currently in circulation haven’t moved in 155days," 

indicating a strong long-term investor confidence. The ARK 21Shares Bitcoin ETF, launched by Wood's firm, underscores this belief, holding $705.8 million in Bitcoin, a testament to the growing trust in Bitcoin as a long-term investment alternative to gold.