Bitcoin was supposed to be a kind of digital gold, a repository of value not aligned with the vagaries of the market.

And until recently, it was proving that theory.

In February, when stock markets in Australia and the US were peaking, Apollo investment manager Henrik Andersson said investment funds were treating Bitcoin like gold.

“Bitcoin behaves like a high beta gold and I think there’s a narrative building around it as digital gold,” he said.

“Bitcoin is becoming more scarce as well. In May this year the supply will be cut. That could be another trigger for the bitcoin market.”

But that theory is being put to the test, as Bitcoin’s fall from its 2020 peak is closer — marginally — to that seen by equities, not gold.

Gold however has come off a massive run, returning to levels last seen in January. It peaked at $US1700 ($2758) in March and has since dropped about 9 per cent.

The six month gold price in US dollars. Chart:

Bitcoin also began a run up in January, peaking at $US10,395 in February, before plunging 49 per cent.

The six month Bitcoin price in US dollars. Chart:

The ASX All Ordinaries is down 29 per cent from its February peak.

The All Ords over the last six months. Chart:

Crypto bull Anthony Pompliano, the cofounder and partner at Morgan Creek Digital, speculated on Twitter over the weekend that both gold and Bitcoin were suffering from a liquidity crisis as people rushed to put their assets in cash.