The myth of digital gold shattered? An in-depth analysis of why BTC has recently been behaving more like a high-risk asset

Recent market data shows that Bitcoin’s price has declined from its annual high of $97,860.60 on January 14th. As of February 11th, BTC is temporarily priced at $66,500.00, down more than 30% from the year’s high.

Meanwhile, Bitcoin’s correlation with global stock markets, especially tech stocks, has significantly increased. Its price volatility no longer exhibits the characteristics of a traditional safe-haven asset like gold but instead aligns more closely with high-risk tech stocks or emerging market assets.

Market Status: Bitcoin’s Sharp Fluctuations Challenge Safe-Haven Narrative

According to the latest data from Gate, Bitcoin’s performance on February 11th continued to show weakness, briefly hitting a low of $66,500.00, with a daily decline of 2.77%.

This trend extends Bitcoin’s recent downturn. Over the past 30 days, Bitcoin has lost 26.82% of its value, and over the past year, it has fallen by 31.01%.

This data starkly contrasts Bitcoin’s traditional role as “digital gold” and a safe-haven asset. Historically, gold is viewed as a refuge during economic uncertainty, but recently, Bitcoin has declined in tandem with global risk assets.

Market data indicates that Bitcoin’s price has fallen a total of 12.33% over the past week, reflecting extremely fragile market sentiment. Such intense price swings are far from the stability expected of a safe-haven asset.

In-Depth Analysis: Why Does Bitcoin Behave More Like a High-Risk Asset?

From technical indicators and market behavior, Bitcoin is exhibiting characteristics highly similar to traditional high-risk assets. According to Gate’s global market data, the current cryptocurrency fear index is only 11, indicating “extreme fear,” which reflects widespread concern among market participants.

Market liquidation data shows that on February 11th, the total global contract liquidation reached $62.5 million, with long positions accounting for $48.88 million, or 78.2%. Such large-scale liquidations tend to exacerbate downward price pressure.

Correlation analysis with traditional assets reveals a worrying trend. Bitcoin’s correlation with the Nasdaq Tech Index and emerging market currencies has strengthened significantly, while its correlation with safe-haven assets like gold and the US dollar has weakened. This suggests that during market turbulence, Bitcoin is more likely to fall alongside risk assets rather than serve as a hedge.

Meanwhile, indicators such as open interest in Bitcoin futures and funding rates also show extremely high levels of speculative activity. According to Gate data, global futures open interest stands at $30.2 billion, with Gate’s platform accounting for $4.2 billion—both at historical highs. This high leverage environment amplifies price volatility, making Bitcoin behave more like a high-beta risk asset.

Data Comparison: Bitcoin vs. Traditional Safe-Haven Assets

By comparing Bitcoin’s performance with gold, US Treasuries, and other traditional safe-haven assets under different market conditions, we can better understand Bitcoin’s risk asset characteristics.

Recent market data shows that during periods of increased Federal Reserve policy uncertainty and geopolitical tensions, gold prices remain relatively stable or slightly rise, while Bitcoin experiences sharp fluctuations. For example, on February 11th, when Bitcoin plunged, traditional safe assets did not decline in tandem.

From a liquidity perspective, although Bitcoin has high trading volume, in extreme market conditions, liquidity can rapidly dry up, leading to sharp price swings. In contrast, traditional safe assets tend to maintain better liquidity under market stress.

Future Outlook: Can Bitcoin Regain Its “Digital Gold” Status?

Despite recent disappointing performance, Bitcoin’s long-term narrative remains intact. Gate’s price forecasts suggest that by 2031, Bitcoin could reach an average price of $1,008,236.17, representing significant upside from current levels.

However, realizing this forecast depends on Bitcoin’s ability to re-establish its safe-haven qualities. Many institutional investors continue to monitor Bitcoin’s long-term potential, especially as a hedge against inflation and currency devaluation.

Crypto analysts note that for Bitcoin to truly become “digital gold,” progress is needed in key areas: first, clearer regulatory frameworks to reduce policy uncertainty; second, further integration with traditional financial systems to increase institutional acceptance; third, market structure maturation to reduce extreme volatility.

It is also important to note that Bitcoin’s fundamentals are still evolving. With more institutional participation, clearer regulation, and improved technological infrastructure, Bitcoin’s market behavior may change over time.

Investment Strategies: Finding Opportunities Amid Uncertainty

In the current market environment, investors need to reassess Bitcoin’s role within their portfolios. Based on Gate’s market data and analysis, the following strategic considerations are suggested:

Diversification becomes especially important. While Bitcoin may temporarily lose its safe-haven halo, its value as an alternative asset class remains. Investors should consider including Bitcoin in their portfolios, but proportionate to their risk tolerance.

Focus on long-term fundamentals rather than short-term price swings. Bitcoin’s scarcity (total cap of 21 million coins) and decentralization remain core value propositions. Although short-term price action resembles risk assets, these fundamentals have not changed.

Consider dollar-cost averaging strategies, taking advantage of current market pullbacks to gradually build positions. Gate data indicates that market sentiment is in “extreme fear,” which could present attractive entry points for long-term investors.

Summary

When market panic spreads, large-scale liquidations occur simultaneously with long positions, and global futures open interest remains high, Bitcoin’s price explores new support levels amid intense volatility.

Since the beginning of the year, Bitcoin has fallen more than 23.98%, and CME Bitcoin futures’ forward curves show cautious expectations for prices in the second half of the year. Futures contracts from February have prices around $67,300, rising to about $71,900 for December contracts, indicating investor expectations of a gradual recovery within the year, though the process remains challenging.

Market data suggests that the market remains cautious about Bitcoin’s ability to quickly recover lost ground.