While the gold price is breaking records and has just passed the symbolic threshold of $3,000 an ounce, bitcoin is struggling and looking for its second wind. Rarely has such a marked divergence been observed. Since December 2024, bitcoin has lost 30% of its value against gold. How can such a gap be explained in such a short space of time?
Calling bitcoin “digital gold” is clearly too simplistic, as the two assets have different dynamics. How should they be valued?
We need to distinguish between two concepts that tend to be confused: store of value and safe haven. Gold and bitcoin are stores of value insofar as they enable us to store value over time, even to increase it, and thus protect ourselves against inflation and the devaluation of fiat currencies. This is true for the long term. Whereas a safe-haven asset offers protection in the event of a crisis or geopolitical tensions, gold is ideal for fulfilling this function, whereas bitcoin is far too volatile (Hasheur’s explanation on the subject).
Since the beginning of the year, with the inauguration of Donald J. Trump, geopolitical tensions have risen a notch (tariffs, desire to disengage from NATO, rumors of Iranian nuclear bombing, etc.), and gold is taking full advantage. Its price is climbing, and has hit a series of highs. As is does not have any counterparty risk, can be held in the investor's own hands and has an intrinsic value recognized since the beginnings of civilization, physical gold is the perfect asset to protect oneself from the blows of firedamp. Bitcoin, for its part, is currently suffering for precisely these reasons: it's stalling, people are selling it to recover liquidity, they're switching to gold, and its volatility is rising, scaring off many investors.
According to a Bank of America survey quoted by The Kobeissi Letter, 58% of fund managers said that gold performs best in times of trade war, against only the dollar in second place at 15%, 30-year US Treasuries at 9%, commodities at 7%, and bitcoin at 3%, which is on a par with equities (2%).
The market's opinion is perfectly clear. This difference can also be seen and explained in terms of capitalization: all the world's gold is worth over $20 trillion, ten times more than bitcoin. (Infinite Market Cap).
Rather than confusing them, it would be better to think of gold and bitcoin as two assets based on scarcity indeed, but quite different in other respects. Even better, owning them together allows you to intelligently diversify your wealth, in proportions that can be adapted to your own objectives and risk appetite.
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The information contained in this article is for information purposes only and does not constitute investment advice or a recommendation to buy or sell.
