Benson Sun: We are now at the starting point of the largest bull market in Bitcoin’s history, and BTC’s “golden bloodline” is awakening

Mars Finance reported that on September 6, Coinkarma founder Benson Sun published a lengthy article titled “Bitcoin’s Golden Bloodline Awakens: This Could Be the Starting Point of the Biggest Bull Market in BTC History,” stating that many people still doubt whether the bull market has arrived. He believes that what comes next will be more than just a bull market; it will be a major bull market. Benson Sun believes that BTC is switching from a “high-beta tech stock” to a “hard asset resistant to fiat currency depreciation,” with its correlation with gold reaching an all-time high while decoupling from U.S. stocks. BTC’s 60-day correlation coefficient with gold has risen to 0.663, officially surpassing the previous historical peak of 0.64 from November 2020 and reaching its highest level since trading records began in 2011. It closed above 0.65 on two consecutive trading days, September 3 and 4, meaning this was not merely a single-day spike. A 60-day BTC-gold correlation coefficient above 0.5 is extremely rare, occurring on only 2.2% of trading days historically, and it has previously appeared only during two periods. In August 2020, BTC traded sideways between $10,000 and $12,000 before beginning its main upward leg and rising to $64,000. In October 2022, Bitcoin was in a long-term bottoming area. Despite the FTX black swan event in between, it still rose 276% from the signal level to its subsequent high of $73,000.

This is the third time in history that such a high correlation with gold has emerged. This time is also more straightforward: as the correlation with gold broke above 0.6, the correlation with the Nasdaq fell below 0.25. Previous bull markets were mainly driven by the halving narrative combined with an outflow of dollar liquidity, while digital gold was more of a theme and rarely became the true central narrative. The market has produced a rare combination of “high correlation with gold + low correlation with U.S. stocks + thorough shakeout.” At the macro level, the issues surrounding U.S. debt and confidence in the dollar are being repriced. Therefore, Benson Sun believes that the current market looks more like the early stage of the main upward leg of a bull market rather than an ordinary oversold rebound.

The market has also seen a divergence between the U.S. Dollar Index (DXY) and Treasury yields: Over the past three months, the 30-year U.S. Treasury yield rose from 5.0% to 5.25%, briefly reaching 5.34% on August 18, a new high since 2007, while DXY fell from 101 to below 100. Rising yields combined with a falling dollar rather than a stronger one indicate declining market confidence in the dollar. If the anti-depreciation trade becomes the market’s central theme again, and BTC happens to reach an all-time high in its correlation with gold at this moment, this coincidence deserves attention. In recent years, the market has grown accustomed to treating BTC as a high-volatility tech stock, but this cycle is different. BTC rose approximately 24% in a single week in August, while gold rose 5.6% and the Nasdaq fell 2.1% over the same period. BTC’s “golden bloodline” is awakening.