Cathie Wood predicts additional declines for gold, asserting that ARK’s innovative sectors, such as blockchain and artificial intelligence, may lead to lower inflation rates than expected.
- Bitcoin has significantly surpassed gold’s performance since mid-August, achieving over a 30% increase as gold saw nearly a 5% decrease.
- ARK noted a long-term correlation of 0.1, which has recently shifted to negative, as stated by Cathie Wood.
- Citi has updated its 12-month Bitcoin price target to $113,000 earlier this week.
Since August, Bitcoin (BTC) has outperformed gold, leading ARK Invest’s CEO, Cathie Wood, to declare that the “turn is in” for Bitcoin against gold.
In a recent episode of In the Know released on Friday, Wood stated, “We believe the turn is indeed here for Bitcoin.” She described the Bitcoin-to-gold ratio shift as “a very favorable turn,” noting Bitcoin’s rise alongside gold’s fall.
Gold Declines As Bitcoin Rises
Since August 16, Bitcoin has been performing strongly compared to gold. Bitcoin has surged by over 33% during this period, while gold has dropped by more than 4%. The two assets have clearly diverged in their trajectories.
Bitcoin’s price traded above $85,200, reflecting a rise of over 0.7% in the last 24 hours. On Stocktwits, the public sentiment surrounding Bitcoin hovered in the ‘bearish’ range, with conversations declining to ‘low’ from ‘normal’ levels in the past day.
Correlation Between Bitcoin and Gold Turns Negative
On the flip side, Wall Street has adopted a more optimistic stance on Bitcoin. Citi recently increased its 12-month Bitcoin target to $113,000, reversing prior reductions made earlier this year. Despite this, the new target remains less than Bitcoin’s peak, exceeding $126,000 in October 2025.
Often referred to as digital gold, Bitcoin’s relationship with gold is examined by Wood, who noted that ARK’s analysis dating back to 2019 indicated a correlation of only 0.1. A correlation of 1 signifies that the two assets move together, while 0 indicates no connection whatsoever, which is why she labeled it as “no correlation.”
Wood further noted that this correlation has recently turned negative, signifying a divergence in the movements of Bitcoin and gold.
Wood Anticipates Further Declines for Gold
Wood mentioned that gold reached its peak around the time former President Donald Trump appointed Kevin Warsh as Chair of the Federal Reserve and has been on a downward trajectory since then. “We wouldn’t be surprised to see it continue to drop,” she asserted, linking this outlook to a broader view on inflation.
Fed Chair Warsh is unlikely to overlook the persistent drop in core inflation. Wood referenced the latest Personal Consumption Expenditures (PCE) report, which indicated headline inflation at 3.4% year-over-year in August, down from 3.7% after adjustments. According to her, a private index called Trueflation reveals that core inflation is still on the decline. Her analysis follows the Fed’s interest rate hikes in September.
A new PCE methodology could potentially reduce core inflation readings by 0.2 to 0.4 points, according to Tom Lee, chairman of BitMine Immersion Technologies (BMNR). If this indicates that the Fed tightened too soon, he suggested it might signal a bullish trend for cryptocurrencies.
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