Bitcoin has been on a parabolic bull run since late 2020. As the flagship crypto’s price hit all-time highs after all-time highs, bitcoin’s market cap has also been climbing the leaderboards. Bitcoin has overtaken renowned companies like Alibaba, Berkshire Hathaway, Visa, JPMorgan Chase & Co., among others in market capitalization.
Moreover, the premier cryptocurrency has also been gradually stealing gold’s thunder. Bitcoin, which is deemed as a digital store of value, gained so much popularity in 2020 in light of the global economic uncertainty and massive money printing wrought by the coronavirus pandemic. For perspective, the cryptocurrency is increasingly being used by Wall Street investors as a hedge against the inevitable inflation, highlighting the unprecedented shift in institutional appetite toward cryptocurrencies.
As such, some believe that bitcoin has already eaten up a significant chunk of the yellow metal’s market capitalization. This is, however, not the case — at least not yet. According to the CEO of blockchain analytics firm CryptoQuant, Ki Young Ju, the cryptocurrency has managed to take only 2% of gold’s market cap.
Taking 10% Of Gold’s Market Cap Would Mean That Each BTC Is Valued At $154K
BTC’s price soared to new heights towards the end of last year, clocking a new lifetime high above $42,000 last week. Observers suggested that most investors were dumping their gold in order to buy bitcoin, and as this happened, bitcoin snatched roughly 7% of gold’s $10 trillion market cap.
However, according to Young-Ju, bitcoin has actually stolen only 2% from gold. This is based on the asset’s realized market cap. As opposed to the conventional market cap, the realized market cap takes into account the price at which each bitcoin was when it last moved. Notably, it does not consider the bitcoins that are held in centralized exchanges. Additionally, it is significantly lower than the market cap because it excludes the lost coins.
BTCUSD Chart By TradingView
As of January 13, bitcoin had a realized market cap of $227 billion and an ordinary $708 billion at press time. Bitcoin capturing at least 10% of the precious alloy’s market capitalization would imply that the top crypto’s price would be standing at $154,000.
People said $BTC took 7% of the Gold market cap.
— Ki Young Ju 주기영 (@ki_young_ju) January 13, 2021
No, it's not. There are unclaimed, unreachable, and lost Bitcoins. Based on the realized cap, it's just 2%.
If digital gold replaces 10% of the $XAU market cap then the $BTC price would be $154k.
Charthttps://t.co/2HBadLeeHJ pic.twitter.com/ruD0drWc8c
Bitcoin is changing hands at $38,120.01 at the time of publication, up 9.95% over the past 24 hours.
