Welcome to our institutional newsletter, Crypto Long & Short. This week:
- Dovile Silenskyte provides an alternative to the “bitcoin as a risky asset” narrative.
- Joshua de Vos shares insights and analysis on global exchanges.
- Top headlines institutions should be aware of by Francisco Rodrigues.
- CoinDesk 80 Leads as Crypto Outperforms Across Asset Classes in the Chart of the Week.
Thanks for joining us!
-Alexandra Levis
Expert insight
Bitcoin vs. gold: 26% relative undervaluation
By Dovile Silenskyte, Director of Digital Asset Research, WisdomTree
For years, markets have struggled to classify bitcoin. Currently, the dominant media narrative tends to treat bitcoin as a high-beta expression of investors’ risk appetite: rising when liquidity is plentiful and falling when markets turn defensive.
That framing increasingly misses the larger structural shift underway.
Bitcoin is evolving into a monetary asset competing for the same macro allocation bucket as gold. Both bitcoin and gold:
- Sit outside the traditional fiat system.
- React to inflation expectations, real interest rates and confidence in sovereign currencies.
- Attract investors looking for scarce and politically neutral stores of value.
The difference is that gold represents monetary defensiveness while bitcoin represents monetary expansion. This distinction changes how bitcoin should be analyzed.
Rather than evaluating bitcoin through an equity or risk asset framework, we believe the cleaner analytical lens is bitcoin versus gold. The key question is not whether bitcoin will rise in absolute terms, but whether its monetary premium to gold is too low or too high given the prevailing macro backdrop.
Our Bitcoin in Gold (BiG) model attempts to answer just that question. Per 31 March 2026:
- Actual bitcoin/gold ratio: 15.6
- Model fair value: 21.1
This difference suggests that bitcoin is 26% undervalued relative to gold.
Figure 1: The actual bitcoin/gold ratio is well below the model estimate
Source: WisdomTree, Stooq. From 31 December 2013 to 31 March 2026. Historical performance is not an indication of future performance and any investment may decline in value.
This gap is not abstract. It reflects current macro inputs embedded in the model. Specifically, bitcoin reacts more aggressively than gold to macro shifts:
- Falling real interest rates / easier liquidity: bitcoin is doing better.
- Stronger USD / risk-off: gold surpasses.
- Rising inflation expectations: typically supports gold first.
Today’s mix implies a higher bitcoin/gold ratio than observed.
Per 31 March 2026, the model assigns the highest probability to the following three macro scenarios over the next 12 months, each leading to different outcomes:
- Current: no shock; gradual convergence to fair value.
- Inflation shock: gold leads in the first place; bitcoin catches up later.
- Risk off: stronger USD; gold surpasses.
Figure 2: Scenario paths for the bitcoin/gold ratio
Source: WisdomTree. 7 April 2026. The model assumes that the macro scenario starts on 1 April 2026 and continues for the next 12 months. Forecasts are not an indication of future results and any investment is subject to risks and uncertainties.
For investors, there are three practical applications of the BiG model:
- Relative value trading: long bitcoin and short gold is a potential implementation approach.
- Allocation slope: if you hold both, increase the bitcoin weight when the distance is large.
- Macro overlay: combined with real interest rates, dollar trends and liquidity indicators.
The BiG model is a positioning tool. The edge comes from systematically leaning into dislocations when they are wide and scaling back when they are compressed. The discipline is straightforward: track the gap, anchor decisions in the macro context and avoid overfitting short-term price movements.
See further details in Bitcoin vs gold: bitcoin looks 26% undervalued vs gold blog.
Principled perspectives
The centralized currency market is pulling apart
By Joshua de Vos, Head of Research, CoinDesk Data
Centralized exchanges have long maintained that the industry has reached maturity. CoinDesk’s May 2026 Exchange Benchmark, which evaluates 75 spot exchanges against more than 100 metrics, provides a stern test of this claim. The resulting data are encouraging in some areas and complex in others; most notably, it reveals a systemic vulnerability to market failure that persists even among top-tier venues.
The bar is rising
The primary shift in this cycle is methodological: the AA rating threshold was raised from 80 to 85, reflecting the higher institutional standards required as the benchmark evolves. Six exchanges met these new criteria: Bitstamp by Robinhood (90.26), Coinbase (88.58), Kraken (87.77), Binance (87.25), Bullish (86.99) and Crypto.com (86.22). For the first time in three years, Bitstamp leads the ranking, overtaking Binance. Meanwhile, Gemini and OKX moved from AA to A status. This reclassification was a direct consequence of the higher threshold rather than a drop in quality, as both exchanges actually improved their individual scores.
The Exchange Grade Distribution highlights a significant development over the last three cycles. The most notable change occurred at the bottom of the scale; the number of E-grade exchanges fell from 11 in November 2025 to just four, with seven venues moving up to D-tier. This represents the largest single-cycle grade change in the benchmark’s history. The universe’s average score rose to 58.42, marking a third straight period of improvement, and the number of ‘Top-Tier’ exchanges (rated BB or higher) grew to 21 from 20 last cycle.
The volume concentrates at the top
Top-tier exchanges now command 59% of Q1 spot volume despite accounting for only 27% of rated venues; a sharp increase from 40% in October 2025. This trend is consistent with a long-term pattern of institutional capital gravitating toward venues with verifiable infrastructure. Binance remains the dominant force with 24% of total spot volume, nearly four times that of its nearest competitor. Conversely, MEXC commands 6.25% of global volume but remains C-rated, illustrating a small but visible disconnect between trading activity and institutional risk standards among longtail asset trading.
October’s lesson
A critical finding of this cycle involves the market-wide exchange failure on October 10, which caused price drifts across 62 of the 75 benchmarked exchanges and affected at least 571 trading pairs. The incidence of flash crashes was nearly universal, affecting 81% of all evaluated exchanges, including 100% of AA-grade and 100% of B-grade venues. These findings suggest that such market failures are systemic rather than isolated to lower-level platforms. To better track this, the benchmark has introduced a broader flash crash rating to monitor venue resilience.
What the data still shows
Transparency continues to trend upward. Proof of Reserve coverage reached 63% and due diligence questionnaire (DDQ) submissions reached an all-time high with 21 confirmed responses. However, the regulatory landscape remains fragmented. Despite MiCA being in force since the end of 2024, only 16 of the 75 benchmarked exchanges have a full license and 66% have no regulatory presence at all in the EU. Notably, HitBTC, Thalex and Woo have yet to establish a regulatory footprint in any jurisdiction.
Looking ahead, the November 2026 cycle will open for exchange submissions in October. As institutional allocation to digital assets deepens and control by counterparties increases, the cost of operating outside institutional risk frameworks only increases. Benchmark plays a central role in making that cost visible.
This week’s headlines
– Off Francisco Rodrigues
This week’s headlines show a new wave of capital pouring into the crypto infrastructure as banks, asset managers and tokenization platforms race to build the rails for institutional adoption. It’s even as one of the sector’s biggest bitcoin holders is flagging potential selling pressure.
- Circle Raises $222M for Arc, Beats Q1 Earnings Estimates But Misses Revenue: The USDC issuer closed the round at a $3 billion valuation for its Arc blockchain token, with backing from BlackRock, Apollo and Bullish, along with Q1 results that topped earnings expectations but came in light on the top line.
- Ripple raises $200 million from Neuberger Berman to expand its Ripple Prime platform: The new facility will fund the build-out of an institutional prime brokerage offering that meets the growing demand for margin financing and trading services spanning both traditional and digital asset markets.
- Morgan Stanley brings crypto trading with lower fees than competitors: The bank is rolling out spot crypto on E*Trade at a 50 basis point transaction fee, undercutting Coinbase, Robinhood and Charles Schwab, while giving its wealth clients a bank-driven route into the asset class.
- Crypto platform Bullish buys Equiniti for $4.2 billion, building tokenized securities infrastructure: The deal adds regulated transfer agents, shareholder registries and issuer services to the exchange’s stack as it positions itself for tokenized securities, 24/7 trading and stablecoin-based settlement.
- Michael Saylor’s strategy signals potential bitcoin sale to fund dividend obligations: After reporting a $12.54 billion loss in the first quarter, the company said it may sell BTC to meet dividend payments, refocusing on leverage, funding costs and potential supply overhangs linked to publicly traded bitcoin treasury firms.
Chart of the week
CoinDesk 80 Leads as Crypto Outperforms Across Asset Classes
Bitcoin has gained 5.7% month-to-date, outperforming major asset classes including the S&P 500, gold and oil since the start of May 2026. This strength has filtered down to market caps, with the CoinDesk 80 (CD80) up 15.32% MTD — well ahead of majors — 57%r. The difference between CD80 and BTC, CD5 and CD20 (all combined around 3-5%) suggests that momentum is rotating to smaller-cap altcoins as the broader crypto rally widens.
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Note: The views expressed in this column are those of the author and do not necessarily reflect the views of CoinDesk, Inc., CoinDesk Indices, or its owners and affiliates.
