Bitcoin’s recent price behavior shows it may be returning to its roots as a hedge, according to Custodia Bank CEO Caitlin Long.
In a Roundtable discussion with TheStreet’s Rob Nelson, Long pointed out that for the first time in a long while, Bitcoin is trading more like gold than a tech stock.
“Bitcoin’s correlation is higher with gold in the last two days than it is with the Nasdaq,” she said. “Historically, up until the last two days, that has not been the case. Bitcoin traded like a high vol Nasdaq stock and gold was quietly marching up and had outperformed Bitcoin year to date.”
The shift comes amid broader market volatility. Stocks dropped sharply while bonds rallied — a decoupling that Long said we haven’t seen since COVID-era disruptions.
She traced the cause to deliberate actions from U.S. economic authorities. “The Treasury Department wanted exactly this. They aren’t as focused on the stock market as they are focused on getting interest rates down… to heal the banking system, to create more refi opportunities in the mortgage market, and help the U.S. government with this wall of refinancing of Treasury debt.”
Long, who has long warned of systemic fragility in traditional finance, said the current move is risky but not yet disastrous. “Is it risky what they’re doing? Yes… But we’re not there yet just because we’ve had a 5% one-day correction.”
She also noted that Bitcoin’s four-year halving cycle remains intact. “That is a fundamental cycle. It has to do with the profitability of miners. And you can see when the price goes down, that hash rate exits the market.”
Bitcoin halving is a scheduled event that occurs roughly every four years, cutting the reward miners receive for adding new blocks to the blockchain by 50%. This process reduces the rate at which new bitcoins are created, making the asset scarcer over time. Halvings are seen as pivotal for Bitcoin’s price and supply dynamics.
While she declined to offer a direct price prediction, Long added that Bitcoin’s behavior now reflects traders “looking for insurance” amid rising fears of instability.
Custodia Bank is a Wyoming-based digital asset bank founded by Caitlin Long. It focuses on bridging traditional finance and crypto by offering compliant custody and payment solutions for digital assets. The bank is known for pushing regulatory clarity in the crypto-banking sector.
