As Bitcoin approaches its strongest performance relative to the S&P 500 in years, Bloomberg Intelligence’s senior commodity strategist, Mike McGlone, is cautioning investors not to get too comfortable. While the world’s top cryptocurrency has rallied close to $97,000, outperforming traditional stock indices, McGlone believes there’s a major warning sign flashing in the background.
Bitcoin’s recent gains have stirred fresh optimism in the crypto market. However, McGlone, who has long tracked macroeconomic indicators and Bitcoin correlations, says investors may be missing a critical piece of the puzzle: the weakening BTC-to-gold ratio. According to him, this breakdown could signal an underlying shift in market sentiment that doesn’t favor a long-term bullish scenario for Bitcoin.
In recent trading, Bitcoin has soared to $96,953, marking a nearly 3% gain over the last 24 hours. This rise comes as Bitcoin inches toward its highest value ever compared to the S&P 500, one of the leading benchmarks of the U.S. stock market. For context, this ratio is closely followed by analysts to assess how well Bitcoin is performing relative to traditional equity markets.
Historically, a strong Bitcoin-to-S&P 500 ratio suggests growing investor preference for crypto over stocks—often driven by macroeconomic concerns, inflation fears, or expectations of monetary easing. With the Federal Reserve’s interest rate decisions looming, Bitcoin’s resilience is drawing attention as a potential hedge asset.
But McGlone is urging caution, pointing to a different chart: the BTC/XAU (Bitcoin-to-gold) ratio.
Despite Bitcoin’s solid price performance against stocks, its value relative to gold is quietly slipping. McGlone’s recent chart analysis, shared on X (formerly Twitter), highlights a steep decline in the BTC/XAU ratio. This ratio peaked in 2021, during the height of Bitcoin’s bull market, and has since been in steady decline.
In simpler terms, this means that while Bitcoin is becoming more valuable compared to the S&P 500, it is becoming cheaper when measured against gold. Fewer ounces of gold are now needed to buy one Bitcoin. McGlone interprets this as an early warning: “When Bitcoin underperforms gold, it may suggest weakening strength as a risk asset or digital store of value.”
This divergence can be seen as a sign that, while Bitcoin is rallying in the short term, its long-term strength may be weakening in comparison to traditional safe-haven assets.
Despite this red flag, Bitcoin continues to draw support from influential figures in the financial world. Robert Kiyosaki, the best-selling author of Rich Dad Poor Dad, recently reaffirmed his preference for Bitcoin over gold and silver. In a recent tweet, Kiyosaki highlighted Bitcoin’s capped supply as a key reason for his trust in the asset.
“One reason why I trust Bitcoin is there are only ever going to be 21 million,” Kiyosaki said. Unlike gold or silver—which can be mined further as prices rise—Bitcoin’s supply is fixed by its code. Kiyosaki explained that while he owns gold mines and oil wells, their output can be increased, diluting the value of each unit. This can’t happen with Bitcoin.
His endorsement adds a layer of confidence for long-term holders, especially during a period when institutional interest in Bitcoin continues to grow.
Bitcoin’s recent price action also comes ahead of a closely watched Federal Open Market Committee (FOMC) meeting. Investors are anticipating clarity on interest rate policy, which could influence market sentiment toward risk assets, including cryptocurrencies.
While Bitcoin has climbed from $94,670 to $97,430 recently, it also experienced a small intraday dip of 1.08% before recovering 0.6%. This volatility highlights how sensitive the market remains to macroeconomic cues.
Some analysts see Bitcoin’s rising dominance and relative performance against stocks as a sign of resilience. However, the weakening BTC-to-gold ratio serves as a reminder that not all indicators are pointing up.
Bitcoin may be gaining strength against stock indices like the S&P 500, but its slip against gold suggests that investor trust in its role as a safe haven might be wavering. Mike McGlone’s warning should serve as a critical lens for both retail and institutional investors assessing Bitcoin’s future in the broader economic landscape.
As the market awaits signals from the Fed and the BTC-to-gold trend develops further, traders would be wise to balance their enthusiasm with caution. While short-term gains are encouraging, long-term stability will require stronger performance across multiple asset benchmarks—not just equities.
Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.
Get the latest Crypto & Blockchain News in your inbox.
Join Now