Bitcoin hits record undervaluation versus gold; historical signal linked to past BTC rallies

Bitcoin slipped into its deepest undervaluation against gold on Friday, reviving expectations of a potential capital rotation away from the precious metal and back into cryptocurrency markets in 2026. The reading came from the BTC–XAU ratio’s Z-score, which measures how far the current ratio deviates from its long-term average.

A reading below −2 indicates Bitcoin was trading more than two standard deviations below its historical norm compared to gold; the BTC/XAU Z-score entered the model’s lowest band for the first time on record, a move described as extremely rare. Historically, dips toward the −2 zone have preceded extended periods of Bitcoin outperforming gold.

The article cites a November 2022 undervaluation that preceded roughly a 150% BTC price rally over the following year and a March 2020 signal after which Bitcoin rose by over 1,170% a year later. Julius, the analyst who conceptualized the BTC/Gold Power‑Law bands and the Z‑score oscillator, said: "Everything points to Bitcoin massively outperforming Gold over the coming months," and has noted the Z‑score also correctly called prior macro tops.

The discount versus gold therefore suggested a bullish outlook for BTC in 2026, provided the historical pattern holds, and multiple analysts projected BTC would reach $200,000–$300,000 by year-end.

Key Topics

Crypto, Bitcoin, Gold, Btc/xau Ratio, Z-score, Power-law Bands