- Cathie Wood expects further Gold declines as ARK’s innovation themes like blockchain and AI could push inflation much lower than anticipated.
- Bitcoin has surged over 30% since mid-August while gold has fallen nearly 5%, with their correlation recently turning negative.
- Citi raised its 12-month Bitcoin target to $113,000 this week, and Wood said the “turn is in” for Bitcoin against gold.
Bitcoin has outpaced gold by a wide margin since August, and Ark Invest CEO Cathie Wood declared on a recent episode of In the Know that the “turn is in” for the apex cryptocurrency against the precious metal. Wood called the move in the Bitcoin-to-gold ratio “a very nice turn,” with Bitcoin climbing and gold declining.
Bitcoin has gained over 33% since August 16, while gold has dropped more than 4% over the same period. The two assets have diverged sharply, with Bitcoin trading above $85,200 in the last 24 hours.
Meanwhile, Wall Street has taken a more upbeat view of Bitcoin. Citi raised its 12-month Bitcoin target to $113,000, reversing two cuts made earlier this year.
Wood explained that ARK found the long-term correlation between Bitcoin and gold at roughly 0.1, which she described as “no correlation.” That correlation has recently turned negative, meaning Bitcoin and gold are now moving in opposite directions.
Wood said gold peaked around the time President Donald Trump appointed Kevin Warsh as Federal Reserve Chair and has fallen since. “We would not be surprised to see it continue to decline,” she stated, tying that view to a broader call on falling inflation.
She pointed to the latest Personal Consumption Expenditures report showing headline inflation at 3.4% year-over-year in August, down from 3.7%. BitMine Immersion Technologies chairman Tom Lee said a new PCE approach might shave 0.2 to 0.4 points off core inflation readings, adding that if the Fed tightened too early, it would be a bullish sign for crypto.
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