On March 19, 2025, gold officially set a new record above $3,047/ounce, while Bitcoin dropped nearly 3% in 24 hours to $81,967 – 25% away from its peak of $108,786. Although hailed as 'digital gold', Bitcoin is heading in the opposite direction of gold, plummeting alongside US tech stocks amid geopolitical tension and trade policies from President Trump causing confusion. What is happening with these two assets?
Gold Peaks, Bitcoin Fails
Gold surged on Tuesday after news that Israel broke the ceasefire with Hamas, strengthening its reputation as a 'safe-haven asset' amid global instability. Prices exceeded $3,047/ounce, reflecting the influx of money into gold as investors sought refuge. In contrast, Bitcoin fell over 15% in the past month from the ATH on the day of the inauguration (January 20, 2025). Currently (March 18), BTC trades at $81,967, down nearly 3% in 24 hours, according to CoinGecko.
Although Trump promised to support the crypto industry – signing an executive order to establish a strategic Bitcoin reserve – his tough trade policies, such as imposing tariffs on major partners, cause panic. The result: 'high-risk' assets like Bitcoin and Nasdaq stocks are sold off, while gold benefits.
Bitcoin: No Longer 'Digital Gold'?
Bitcoin is often compared to gold due to its scarcity (21 million coins) and role as a store of value. During the banking crisis in 2023, BTC once moved in tandem with gold, separating from tech stocks as investors sought safe assets. However, currently, it is fluctuating in parallel with Nasdaq, influenced by 'high-risk' sentiment amid macroeconomic instability.
Eric Balchunas, a Bloomberg ETF analyst, commented with: “Bitcoin is still too young to stabilize. With great growth potential, it behaves more like a tech stock than gold.” Although expected to be 'digital gold', BTC is not mature enough to react like a safe-haven asset.
Market Impact
Gold: Record price increase shows investors prioritize traditional assets amid geopolitical tension (Israel-Hamas) and economic instability (Trump's tariffs).
Bitcoin: A 25% drop from ATH reflects sensitivity to market sentiment. Trump's crypto-friendly policies are not strong enough to counter macro fears, causing BTC to lose momentum.
Crypto wider: Bitcoin's plunge drags down altcoins (global TVL down 5% this week), while stablecoins like USDT remain stable.
Why Are The Two Assets Diverging?
Market sentiment: Gold benefits from 'risk-off', while Bitcoin gets caught in 'risk-on' along with tech stocks.
Trump's policy: Despite supporting crypto, tariffs create economic instability, pushing investors away from risky assets like BTC.
Maturity time: Gold has a history of thousands of years as a safe asset, while Bitcoin is only 16 years old and remains highly speculative.
Can Bitcoin Become 'Digital Gold'?
Saylor (Strategy) and many believe Bitcoin will achieve its potential like gold as it matures. But currently, these two assets are clearly different: gold rises when the world is unstable, while Bitcoin drops with tech stocks. Will it be able to 'stabilize' to become a safe haven? Balchunas believes it needs time – perhaps decades – to escape its speculative nature.
Conclusion: Gold Wins, Bitcoin Loses – Temporarily?
Gold reaching new highs while Bitcoin plummets shows that 'digital gold' is not yet ready to replace real gold. Although Trump is pushing for crypto, macroeconomic instability is causing BTC to lose appeal compared to traditional assets. But with limited supply and friendly policies from the US, Bitcoin may recover as 'risk-off' sentiment eases. Currently, gold is king – what about Bitcoin? Perhaps it is still the 'prince' trying to find its way to maturity.
Risk warning: Crypto investment carries high risk due to price volatility. Please consider carefully before participating.