Originally posted by Bryan Lutz, Contributor at The Sovereign Capitalist:
Bitcoin is down nearly half from its 2025 high. And now, the obituaries are out of cold storage and back in heavy rotation. Sentiment surveys are scraping levels we haven’t seen since the 2022 crypto-winter, and the financial press has rediscovered its favorite genre: the Bitcoin post-mortem.
And this time they’ve got a chart to wave around. The Dow just had its best year against Bitcoin since 2022 – the Dow/BTC ratio has more than doubled off its August 2025 low, from 0.36 to 0.84.
Here it is. We’ll even draw the red line for them:
The Dow’s twelve-month winning streak against Bitcoin. Note what the line still hasn’t touched: 1.0.
Anyone holding through it felt every point. If you wanted to write the “Bitcoin is finished (again)” piece, this is the chart you’d lead with.
Notice what the line still hasn’t done, though.
It hasn’t touched 1.0.
After the worst sentiment stretch in years, after a ~45% drawdown, after twelve months of losing to the most boomer-coded stock index on earth, the entire Dow Jones Industrial Average still cannot buy one Bitcoin.
Against thirty of America’s biggest companies, the coin wins, with change left over.
If that seems impossible, it’s because you’re reading the fraction the way CNBC wants you to read it:
Bitcoin
───────
$$$$$$$
Bitcoin as the numerator, dollars as the denominator, and the numerator just got cut in half. Case closed, right?
Wrong fraction. As Mark Jeftovic laid out in It’s the denominator, stupid, the entire point of Bitcoin is that it isn’t the thing being measured. It’s the thing you measure with. Put the index where it belongs:
DOW
───────
BITCOIN
Now extend the chart back a decade and hit the log button, which is a one-click jailbreak for fiat-denominated brains:
The Dow, denominated in Bitcoin. A 99% decline that survived every Bitcoin crash along the way, including this one.
In 2014 it took more than 40 Bitcoin to buy the Dow. At the 2015 extreme, 84.
Today: 0.83.’
Measured in the new denominator, the Dow has lost roughly 99% of its value in twelve years, and the “comeback” everyone is celebrating shows up on that chart as a wiggle at the bottom of a cliff. Bitcoin just took its worst beating in years and gave back approximately none of a decade of relative gains.
That’s what deflationary money does. It hits different.
The Dow is priced in dollars, and dollars multiply, inflate, depreciate, and then die… which is the business model for the whole fiat system. M2 only ever pauses on its way up, every crisis gets solved with more of it, and index earnings get marked up in the same shrinking units.
Bitcoin’s supply schedule, meanwhile, doesn’t attend FOMC meetings. The halvings keep halving. Twenty-one million, take it or leave it.
Run the numbers since January 2000: the Dow is up 361% in dollars. M2 is up 394%. Divide one by the other and the twenty-six-year bull market vanishes: measured in the money itself, the index has gone nowhere. Every point of “Dow 52,000” that isn’t printer output rounds to zero.
The Dow and the money supply, same starting line, 26 years later. The index never got ahead of the printer.
So, the fraction has a numerator inflated by an expanding money supply, sitting on top of a denominator that does not expand. Run that equation for a decade and the line on the chart is the only possible output. The drawdowns – 2018, 2022, this one – are volatility inside the trend. And that trend is division between fiat money and Bitcoin.
A Dow’s comeback measured in a shrinking yardstick must sprint just to stand still. This year, it’s rallied hard in dollars. In Bitcoin terms, it clawed back a rounding error.
If this framework sounds familiar, it should. Gold holders have been living it since 1971, just at a different tempo.
In 2001 the Dow cost 42 ounces of gold. Today, with the Dow at nominal record highs and the algos doing victory laps, it costs 12.7 ounces. Two-thirds of the index’s gold-denominated value, gone, during a quarter century of “stocks always go up”.
Yes, gold and Bitcoin diverged this cycle. Gold at $4,142 while Bitcoin sits in a drawdown. They have different volatility profiles, and different adoption curves. Yet, they share the same denominator maths. One asset is the incumbent hard money, the other is the challenger still crossing the chasm. The DOW index can’t outrun either of them over any window that matters.
“Stocks at record highs” is mostly the yardstick shrinking. It is always has been.
Here’s the thing about extreme bearish sentiment: it’s a report on the emotional state of leveraged tourists, not on the asset. Nothing about Bitcoin(or gold) changed this year. The supply schedule didn’t change. The halvings didn’t change. The $300+ trillion in bonds denominated in a melting currency didn’t change, except to get bigger.
The only thing that changed is the price, quoted in the old denominator, and the old denominator’s entire job description is to go down.
So, the mainstream news cycle might be right about one thing:
Deflationary money doesn’t win every year.
However, it does win every decade, and it’s undefeated.
