The copper-to-gold ratio is gaining attention as a key macroeconomic indicator, particularly regarding economic momentum and investor risk appetite. This ratio has historically exhibited a strong correlation with Bitcoin prices, as noted by analysts like SuperBitcoinBro. Specifically, this relationship underscores how copper—linked closely to industrial demand—tends to thrive during economic expansions. Gold, in contrast, generally acts as a defensive asset, flourishing during periods of uncertainty and slower economic growth.
A rising copper-to-gold ratio often signals a “risk-on” environment, suggesting that investors are more willing to take on risk. Conversely, a declining ratio indicates a shift toward risk aversion among investors. Significant peaks in this ratio have been observed in 2013, 2017, and 2021, aligning with cycle highs in Bitcoin prices. These peaks reflect periods of strong global growth expectations and increased speculative investment across various asset classes.
Even more noteworthy for Bitcoin enthusiasts is the behavior of the copper-to-gold ratio following extended declines. Historical data shows that a reversal in the ratio frequently precedes substantial rallies in Bitcoin, particularly when these reversals coincide with the cryptocurrency’s halving cycles. Bitcoin halvings, events that occur approximately every four years, cut miners’ rewards by half, tightening the supply of Bitcoin. These halvings have historically acted as bullish catalysts for longer-term price increases.
As the fourth Bitcoin halving approaches in April 2024, the dynamics surrounding the copper-to-gold ratio are shifting. After bottoming out at around 0.00116 in October, the ratio has climbed to approximately 0.00136. Concurrently, copper prices have surged past $6 per pound, reaching all-time highs, while gold hovers near $4,455 per ounce, also close to record levels. Over the last three months, copper saw an increase of 18%, while gold rose by 14%.
If the current strength of copper is indeed indicative of improving growth expectations rather than merely supply constraints, the resulting “risk-on” sentiment could pave the way for a significant Bitcoin rally in 2026. Investors and analysts alike will be closely monitoring the developments of this ratio in the coming months as the market prepares for potential changes.
