Editor’s Note
This analysis explores an unconventional metric—the BTC/Gold Mayer Multiple—as a tool for gauging Bitcoin’s market position. While often compared, the direct correlation between the cryptocurrency and physical gold offers a fresh perspective for evaluating potential price trends.
Although some Bitcoin bulls refer to BTC as digital gold, physical precious metals can be a good way to predict future movements in the crypto asset’s price.
A Bitcoin trader specifically mentioned the BTC/Gold Mayer Multiple to explain his current optimism towards the cryptocurrency.
The multiple compares the Bitcoin/gold ratio to its 200-day moving average. Proponents of this indicator believe Bitcoin is undervalued if the Mayer Multiple is below 1.
On X, the trader indicated that the ratio is now as low as it was during Bitcoin crash periods, suggesting a buy-the-dip opportunity.
However, before investors place their trust in the Mayer Multiple, it’s good to see how gold and Bitcoin prices correlate. We will also discuss how silver prices can predict BTC’s next move.
The core of this opportunity is a bullish indicator from the BTC/Gold Mayer Multiple, so it’s useful to know how it originated.
Entrepreneur and monetary scientist Trace Mayer created the multiple to track historical Bitcoin price movements in order to discover trends and buying opportunities.
It divides Bitcoin’s current price by its 200-day moving average.
For example, if Bitcoin is currently trading at $120,000 and has a 200-day moving average price of $100,000, it has a Mayer Multiple of 1.2.
A ratio above 2.4 typically indicates Bitcoin is overbought, while a Mayer Multiple of 0.8 tends to suggest an attractive buying opportunity.
You can add more complexity to the Mayer Multiple by comparing the ratio of two assets, like Bitcoin and gold, as the X user did.
Like other indicators, the Mayer Multiple relies on lagging indicators and historical patterns to predict future price movements.
When gold or silver prices rise faster than Bitcoin over an extended period, it often signals that Bitcoin may be preparing for a rebound.
This relationship is captured by the BTC/Gold Mayer Multiple and the BTC/Silver Mayer Multiple. Both indicators measure Bitcoin’s price performance relative to its 200-day moving average compared to these metals.
A Mayer Multiple below 1 means Bitcoin is undervalued relative to gold or silver. Historically, these moments have marked strong buying opportunities.
Figure 1: BTC/Gold Mayer Multiple over the past five years. Values below 1 (dotted line) have historically signaled major Bitcoin accumulation phases.
For example:
The BTC/Gold Mayer Multiple fell to 0.70 in November 2022 and 0.85 in March 2020, each time near Bitcoin’s market bottom. In the following months, Bitcoin’s price more than doubled.
The BTC/Silver Mayer Multiple fell below 1 in September 2020 when Bitcoin was around $10,900, before climbing to nearly $60,000 in April 2021. It remained below 1 from late 2022 to early 2023, and Bitcoin nearly doubled that year.
Recently, the BTC/Gold ratio reached 0.84 and the BTC/Silver ratio briefly fell below 1 in late October. Even slight dips below this threshold, like 0.98 in past cycles, have proven to be solid entry points for long-term investors.
In summary, when the ratio between Bitcoin and precious metals falls below 1, it has historically signaled a “buy-the-dip window” before a major rally.
Figure 2: BTC/Silver Mayer Multiple showing similar undervaluation signals. Each drop below 1 (dotted line) preceded major Bitcoin rallies.
The Gold and Silver Mayer Multiples now suggest a bullish outlook for Bitcoin. The idea is simple: when precious metals outperform Bitcoin for too long, Bitcoin tends to catch up — and then outperform them dramatically.
So far this year, gold has risen 54% against 63% for silver and 21% for Bitcoin. That said, if history repeats, BTC could soon close this gap and deliver exceptional returns in the coming months.
In the long term, Bitcoin’s performance speaks for itself: it has risen over 700% in the past five years, while gold and silver have roughly doubled.
Beyond the Mayer Multiple signal, the macroeconomic context also supports Bitcoin’s rise; thus, lower interest rates, pro-crypto policies, and growing institutional investment create ideal conditions for BTC to outperform again.
The moral of the story: Metals and cryptos are not necessarily equal, but that doesn’t stop them from collaborating.