Gold and silver follow the price of Bitcoin at all-time highs

It’s not just the price of Bitcoin that has recently reached new all-time highs: gold and silver are also at their highest levels. 

Since the end of the bear market, in fact, the prices of some commodities have also risen significantly, with a trend in some ways similar to that of Bitcoin. 

The relationship between the price of Bitcoin, Gold, and Silver

Using the bottom of the last bear market as a reference point, at the end of 2022, it is discovered that the rise of Bitcoin has also been followed by that of the price of gold. 

Actually, the price of gold had already started moving earlier, in October 2022, while that of BTC, after crashing to $15,500 due to the FTX failure the following month, really began to recover only in January 2023.

Even when it comes to all-time highs, gold has preceded Bitcoin.

Gold returned above $2,000 per ounce already in November 2023, then the following month set new all-time highs. Instead, Bitcoin had to wait until March 2024 to update its all-time highs. 

The price of gold had already been above $2,000 per ounce after mid-2020, during the pandemic. The following year it had dropped below $1,700, right during the Bitcoin and stock market bull run, but only to return close to $2,000 in March 2022, during a bear market when several US banks began to fail.

Interestingly, however, it had then dropped back below $1,700 again at the worst moment of the bear market, towards the end of the year, before starting to recover in November 2022, while Bitcoin was at the bottom of the bear market itself. 

During 2023, the price of gold never dropped below $1,800 per ounce, and in October, after returning to $2,000, it started its relatively small bull run, as the peak was reached today above $2,300.

For gold, which is considered a risk-off asset, a -40% decrease in less than six months is quite anomalous, while for Bitcoin it would be just business as usual.

In fact, while the price of gold recorded a +40% increase, that of Bitcoin recorded a +290% increase, which would be even higher if the maximum value of March 14th were taken as a reference point instead of the current one. 

Silver and Bitcoin

The price of silver has not yet updated its historical highs. 

For now, the $28.3 per ounce of August 2020 are holding up, although they have been approached several times in the meantime. 

Especially in mid-2021, when it exceeded $27.9, and today, with the return above $27. 

It is worth noting that the price of silver had started to suffer a little during the bear market, so much so that it had already begun to decline as early as August 2021.

However, the real decline began in April 2022, always ending between September and October of that same year, like gold.

Using as reference always the values of October or November 2022, the price of silver has since risen by 50%, while gold recorded a +40% and BTC a +290%. 

The outperformance of silver compared to gold is mainly due to the fact that during 2022 the price of silver had fallen more in percentage terms compared to that of the ultimate safe haven asset.

So now its rebound is higher, although still slightly distant from the highs.

Market concerns

These rebounds suggest that markets are a bit worried about the future. 

In particular, the issue is the possible return to an increase in inflation. 

Markets always tend to anticipate, or try to anticipate, trends, and it seems that at the moment they are betting on a halt to the decline in inflation in the USA, which has been ongoing since October 2022. 

However, they refer to the trend of core inflation, not general inflation which is too volatile.

It is possible that they believe that this descent, which has been going on for almost a year and a half, could come to an end in the short term. 

However, the fact that the price of silver has not yet returned to its highs suggests that this hypothesis may not have been fully priced in, but only partially, and this seems to be confirmed also by the fact that the price of copper is still far from its historical highs: $4.2 per pound, against the historical high of $4.9 in February 2022. 

Market capitalizations according to the new price of Bitcoin, gold, and silver

According to Infinite Market Cap data, at this moment gold capitalizes a total value on the markets exceeding 15.5 trillion dollars.

Silver, on the other hand, only capitalizes 1.5 trillion, just over 1.3 trillion of Bitcoin. 

It is worth noting that the most capitalized company in the world at the moment is Microsoft, with 3.1 trillion dollars, which is five times less than gold but more than double silver. 

Around the 1.300 billion mark, besides Bitcoin, there is only Meta (formerly Facebook), while above the 1.500 mark there are Amazon, Alphabet (formerly Google), Saudi Aramco, Nvidia and Apple, the last two above 2.000 billion.

For example, Warren Buffet’s company, Berkshire Hathaway, has a market capitalization of less than one trillion dollars.