Bitcoin is currently trading at a roughly 30% discount compared to its Nasdaq 100-implied fair value. While any high-conviction Bitcoiner already knows how cheap the asset is right now, this ratio highlights the knock-down BTC price in proportion. And it’s a divergence that has historically implied a deep undervaluation.
According to data from ecoinometrics, based on its long-term correlation with the tech-heavy index, Bitcoin’s fair value sits near $156,000, while spot prices today hover around $110,000.
The last time we saw such a gap was in 2023, and it came before a significant rally. As ecoinometrics states:
“Unless you believe the bull market is already over, this gap is likely to narrow as Bitcoin catches up.”
While Bitcoin has underperformed tech stocks in recent weeks, Bloomberg data show that its correlation with major U.S. indexes remains intact. This suggests the market is recalibrating rather than collapsing. Bitcoin’s roughly 30% discount to its Nasdaq-implied fair value represents one of the widest valuation gaps seen in the last two years. When risk appetite returns, that capital could flow into Bitcoin.
Open interest wipeout
The October flash crash wiped out more than $12 billion in open interest, one of the sharpest contractions in Bitcoin derivatives history. Futures open interest fell from $47 billion to $35 billion, as widespread deleveraging occurred.
Many analysts interpret this as a bullish reset. Leverage has been flushed, leaving room for organic spot demand and renewed ETF inflows. BitMine and Fundstrat’s Tom Lee told CNBC that the “huge deleveraging event” is still plaguing the crypto market, but with open interest now at record lows at a time when both Bitcoin and Ethereum fundamentals are solid, “you’re going to see a crypto rally before the end of the year.”
What’s more, options open interest now exceeds futures by $40 billion, which is a sign of growing market sophistication and reduced speculative leverage. As Glassnode points out:
“Bitcoin’s derivatives landscape is changing as Options OI begins to rival Futures. Markets are shifting toward defined-risk and volatility strategies, meaning options flows, rather than futures liquidations, are becoming a more influential force in shaping price action.”
Rotation from gold to Bitcoin: a macro reallocation
Meanwhile, gold’s record‑breaking rally appears to be running out of steam. Bloomberg reported on October 22 that even “die‑hard gold bulls” are acknowledging the surge looks overstretched after bullion’s steepest weekly drop in over a decade.
Analysts told Reuters earlier this month that the extraordinary run above $4,000 per ounce has forced investors to rethink the durability of the move, with many now rotating toward high‑beta assets such as Bitcoin.
Investor Anthony Pompliano described an impending “great rotation” from gold into Bitcoin, noting that Bitcoin often lags gold by roughly 100 days in performance cycles. The setup this quarter aligns closely with that historical pattern: gold has outperformed for months, and Bitcoin’s underpricing versus equities now looks like the perfect storm for reallocation.
Younger investors’ preference for digital-native assets, combined with Bitcoin’s superior portability and finite supply, reinforces this structural trend. As gold pauses and liquidity searches for higher-beta stores of value, Bitcoin once again becomes the natural destination.
A rare setup in BTC price for long-term investors
When the BTC price lags this far below its Nasdaq-implied fair value, history shows opportunity. A 30% discount hasn’t been seen in nearly two years. With open interest cleared, leverage reset, and institutional inflows stabilizing, the conditions resemble an accumulation phase rather than a blow-off top.
If the bull market narrative holds, Bitcoin could rapidly close the valuation gap in the months ahead, much like previous cycles following major deleveraging events. As markets reassess risk, the rotation out of gold and back into Bitcoin may serve as the catalyst that ignites the next leg up.
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