Bitcoin may currently be trading below its broader valuation trends when compared with gold and global liquidity measures, according to Samson Mow, CEO of Bitcoin technology firm Jan3.

He argued that the asset appears discounted relative to both gold’s market capitalization and the global money supply, potentially signaling conditions associated with a reversal phase. “Bitcoin is about 24%-66% below its trend relative to gold's market cap or global money supply, while gold is overextended,” Mow said in a Saturday post on X.

At the same time, gold futures for April delivery closed Friday at $5,247.90, while tokenized gold PAX Gold USD traded around $5,404.14 at the time of writing. Mow also pointed to Bitcoin’s Z-score, a statistical measure showing how far price deviates from its historical average. A reading of zero reflects alignment with the average, while positive values indicate price strength above historical norms and negative values suggest price weakness relative to past levels.

Z-score signals and historical comparisons

According to Mow, when the Z-score of the Bitcoin-to-gold ratio drops below −2, Bitcoin has historically entered periods that preceded major rallies. The ratio currently sits near −1.24, indicating that price remains below its historical relationship with gold but has not yet reached extreme historical thresholds.

TradingView data shows that the metric fell below −3 in November 2022 during the collapse of cryptocurrency exchange FTX. Over the following 12 months, Bitcoin’s price increased by more than 150%. A similar setup occurred during the March 2020 COVID-19 market crash, when the ratio moved below −2 as Bitcoin bottomed near $3,717 before rising more than 300% over the next year and eventually reaching a then-record high near $69,000 in November 2021.

Diverging outlooks among market analysts

Mow’s interpretation contrasts with more cautious market views suggesting additional downside risk for cryptocurrencies amid geopolitical uncertainty and fragile investor sentiment. Some analysts argue that Bitcoin’s current structure resembles conditions seen during the 2022 bear market cycle.

Under that perspective, Bitcoin could revisit lower price levels, with projections pointing toward a potential move near $50,000. The asset previously declined more than 50% from peak to trough, reaching roughly $60,000 before stabilizing and recovering modestly toward the $66,400 region following recent developments in the Middle East.

Sources:

https://cointelegraph.com/news/bitcoin-undervalued-gold-potential-rally

https://www.tradingview.com/chart/g7xkPkTa/?symbol=TVC%3ABTCXAU

https://x.com/Excellion/status/2027895773703377156