Bitcoin vs Gold: The Price Struggles

The price of Bitcoin is struggling once again. 

What weighs heavily, especially since yesterday, is the “competition” from gold in the financial markets. 

In recent weeks, the situation appeared to be improving, but yesterday the upward trend came to a halt. 

Bitcoin vs Gold

In reality, Bitcoin and gold are not competing assets. 

Indeed, Bitcoin is clearly and distinctly risk-on, while gold is the quintessential risk-off asset. Therefore, in theory, Bitcoin should not compete with gold in financial markets, and vice versa. 

However, the liquidity flowing within financial markets is the same, so it can happen at certain times that it exits one market to flow into another. 

For instance, yesterday nearly $480 million exited from spot Bitcoin ETFs on traditional exchanges, and by Friday, almost another $400 million had already flowed out (Monday, the American markets were closed for a holiday). 

Previously, however, there had been net inflows for four consecutive sessions, effectively initiating an upward trend. 

Therefore, after a brief week of liquidity inflow into the Bitcoin market, since Friday, liquidity has started to exit again. 

The Strength of Gold

It is highly likely that the gold market has attracted this liquidity. 

Yesterday, in fact, the price of gold rose above $4,700 per ounce for the first time in history, and today it even surpassed $4,800.

It should be noted that 2026 opened at $4,300 per ounce, and that the first-ever surpassing of the $4,000 mark occurred less than three and a half months ago. 

This situation is quite unusual for the price of gold, considering that from November 2022 to November 2024, it increased by 60% over two years, while since then, in less than a year and a half, it has added an additional and remarkable +80%.

In particular, there have been three significant accelerations: the first starting from March 2024, a second beginning in January 2025, and then the third which started in September of the same year and is still ongoing. 

To put these remarkable performances into a historical context, from 2011 to 2020, the price of gold increased by 7% over nine years, and from 2020 to 2023, it rose by 4% over three years. Subsequently, in just over two years, it surged by 120%.

The Bubble

Essentially, a speculative bubble is inflating on the price of gold, which could eventually burst. 

This bubble was typically always created by Bitcoin, approximately twelve months after the U.S. presidential elections (end of 2013, end of 2017, and end of 2021). 

This time, however, the price of gold began to rise hyperbolically in March 2024, and since then it has continued to climb with percentage performances that are absolutely anomalous, more typical of Bitcoin than of gold. 

In theory, the decline of the Dollar Index in 2025 should have favored the rise of the price of Bitcoin in dollars, but the longest U.S. government shutdown in history, lasting from October 1, 2025, to November 12, caused a minor liquidity crisis in the financial markets that had severe effects only on Bitcoin and the crypto markets. 

At that point, BTCUSD was unable to capitalize on the favorable moment created by the decline in the Dollar Index, and liquidity sought higher returns elsewhere, particularly finding them in gold and silver. 

The fact is that the Dollar Index might continue to decline, as the medium-term downward trend that began exactly a year ago still seems to be ongoing. If it continues into February, the speculative bubble on gold could also keep inflating, further draining liquidity from the Bitcoin market. 

It is worth noting that the challenging global geopolitical situation, now fraught with serious risks, has further benefited gold – and disadvantaged Bitcoin – precisely due to its risk-off nature. 

The Burst of the Bubble

However, it remains likely that starting from March, the Dollar Index could reverse its medium-term trend and begin to rise. 

This year, the USA is expected to hold mid-term elections in November, and the current majority party (Donald Trump’s Republican party) would benefit from a strengthening dollar, given that Americans import more than they export. 

If indeed the Dollar Index were to reverse its trend starting in March and begin to rise, the speculative bubble inflating around gold could burst. 

It should be noted, however, that rather than a true financial bubble, it seems more like a kind of euphoria bubble, similar indeed to those of past Bitcoin cycles.

True financial bubbles, when they burst, cause prices to plummet with deep and persistent retracements, whereas the classic Bitcoin euphoria bubbles never manage to bring the price back to where it started. 

For example, in 2017 the BTCUSD bubble began to inflate after surpassing the 1,000$ mark, and eventually burst near 20,000$. However, after the burst, Bitcoin never fell below 3,000$ again, meaning it has always remained at figures more than three times its starting point. 

Therefore, if a bubble of euphoria has also inflated around gold, rather than a true financial bubble, it should be highly unlikely for its price to return below $2,000 per ounce, from which this bubble of euphoria began to inflate. 

Indeed, while on one hand it seems to have the potential to rise even above $5,000 this year, with the burst of the euphoria bubble it might also end up remaining consistently above $3,300 per ounce, which is the level from which the last hyperbolic phase started in August of last year. 

And Bitcoin? 

The problem remains Bitcoin.

If the euphoria bubble on gold were to burst after the end of the medium-term declining trend of the Dollar Index, Bitcoin might lack the liquidity to return to a bullrun. 

However, if the gold euphoria bubble were to burst earlier, for example before mid-February after potentially surpassing the psychological threshold of $5,000 per ounce, there might still be some hope of seeing it above $100,000 in the medium-short term.