Gold Hits All-Time High, Bitcoin Continues to Fall: What's Going On?
Bitcoin may be called "digital gold," but it hasn't exactly lived up to that claim lately, especially as gold has hit new record highs. Gold has continued to rally while Bitcoin has plummeted over the past month — all while geopolitical risks and President Trump's volatile trade policies have roiled financial markets.
Despite often being compared to "digital gold," Bitcoin has failed to reflect the same stability as the precious metal. Instead, it's been moving in lockstep with the U.S. stock market, especially tech stocks, as growing macro uncertainty has sent investors skittish.
Meanwhile, gold — the traditional safe-haven asset — hit a new high on Tuesday, rising above $3,047 an ounce following news of Israel violating a ceasefire with Hamas.
Bitcoin Falls
Bitcoin, on the other hand, has fallen nearly 3% over the past 24 hours, according to data from CoinGecko. Over the past month, the situation has been even worse: the asset has lost more than 15% of its value. Bitcoin is currently trading at around $81,967 per coin, down 25% from its all-time high of nearly $108,786, which it reached on the day President Trump took office.
The new president has promised to strongly support the digital asset industry and ease regulations. He even signed an executive order to create a strategic Bitcoin reserve, among other supportive measures. However, unexpected announcements of tariffs on major trading partners have spooked markets, leading to a sell-off in “risk-on” assets, including Bitcoin and major tech stocks on the Nasdaq.
Bitcoin and Gold Link
In the past, Bitcoin’s price has moved in tandem with gold. During the 2023 banking crisis, when investors flocked to store-of-value assets, Bitcoin began to move with the precious metal. Now, however, as macroeconomic risks mount, Bitcoin is showing a closer relationship with tech stocks, which are vulnerable to changes in global trade policy.
The Impact of Trump’s Trade War
The question now is: Bitcoin or Gold? Investors are having to carefully consider which to invest in during these uncertain times. President Trump’s tariffs—or threats of tariffs—have shaken markets, making riskier assets like cryptocurrencies less attractive. Earlier this week, gold hit a record high, while Bitcoin fell below $93,000, down about 14% from its all-time high in January.
While the current volatility suggests Bitcoin and gold are operating on different rules, Bloomberg ETF analyst Eric Balchunas said the asset needs more time to mature to a point where market volatility becomes more predictable. “It’s too young to be stable,” he said. “Because of the huge upside potential, I think it’s going to behave more like a tech stock.”
So could Bitcoin eventually become the “digital gold” that investors have been hoping for? For now, at least, Bitcoin and gold are still behaving like two very different assets.