The market value of Bitcoin is only 1/500 of that of gold. What is the significance of its price exceeding that of gold per ounce?

Amid frenetic media reports that Bitcoin's price is comparable to gold, some commentators believe that there is too much hype.

Bitcoin Price Needs to Hit $498,750 to Beat Gold

In terms of market capitalization, Bitcoin is only 1/500 of gold.

When the price of Bitcoin managed to surpass the price of an ounce of gold last Wednesday, the internet was abuzz with claims that this was a defining moment in financial history. Even some mainstream media outlets followed suit, such as the BBC, which said the “price surge” of the past few months was a major reversal for Bitcoin.

German economist Holger Zschaepitz called this "a decisive moment in the history of money."

But despite headlines stating that Bitcoin is at “gold parity,” some media outlets didn’t even bother to mention the details; they didn’t even mention that Bitcoin’s price was compared to an ounce of gold, simply referring to it as “the price of gold.”

Twitter celebrity WhalePanda specifically pointed out this phenomenon.

“It’s silly to compare the price of gold to Bitcoin. 1 gold = 1 BTC? That’s like reminding me that Bitcoin is worth more than gold.”

However, gold’s market value is still 500 times higher than Bitcoin’s, which means the digital currency would need to reach nearly $500,000 to truly surpass gold.

As a recent Bitcoinist article explains:

“The price of Bitcoin is close to the price of an ounce of gold, but of course the supply of gold (in USD terms) is much higher than Bitcoin (183,600 tonnes in above ground stocks).

For Bitcoin to rival gold in market value, its price would need to reach $500,000.”

But which asset will be more valuable in the long run is still up for debate.

The ETF hype is about to settle

Regardless, gold prices appear to be coming under pressure, having fallen 10% on Wednesday following news that Venezuela may sell billions of dollars worth of its gold reserves to pay debts this year.

Venezuela has just $10 billion in dollar reserves, $7.7 billion of which is held in gold, while the country's debt is $7.2 billion.

At the same time, the possibility of a Bitcoin ETF being approved appears to be consolidating the price of Bitcoin, and the Bitcoin ETF is expected to significantly push up the price of Bitcoin.

In order to alleviate people's excessive predictions about the Bitcoin ETF, some alternative views on this Bitcoin ETF have emerged on social networks.

One Reddit user said:

“If a bitcoin ETF is approved on March 11, then that would represent a rule change that would allow these types of ETFs to be listed.”

Note: According to the latest news reports, the SEC's approval date is actually March 13th, because March 11th is a Saturday and March 13th is the official SEC working day.

Regardless, some forecasters insist that a positive SEC decision on the first Bitcoin ETF will lead to a rise in Bitcoin prices to $2,000 or even higher.

Vinny Lingham recently published an article warning that rapid price growth in Bitcoin could have side effects and could cause a "Bitcoin bubble" similar to the one in 2013.