Bitcoin News: Gold Rallies 32% Threatening BTC’s ‘Digital Gold’ Status

Key Insights:

• Gold +32% YTD vs BTC +16% — 2× performance.
• Gold $3,500/oz — ~100× since 1971.
• Gold has outperformed BTC over multi-year spans.
• Puts pressure on the “digital gold” narrative.

Bitcoin news —Gold has been the standout asset in 2025, rallying about +32% year-to-date while Bitcoin is up roughly +16%.

One ounce of gold just hit all-time highs near $3,500 – a price level that represents a 100× increase since 1971, when the dollar left the gold standard.

By contrast, Bitcoin has trended more modestly. It briefly topped $124,000 earlier in the year but is only about 16% higher than its January 2025 price.

Bitcoin news —Gold’s Surge Doubles Bitcoin’s 2025 Gains

Gold’s surge has multiple drivers. Mounting inflation concerns and geopolitical uncertainty have pushed investors into safe havens.

Analysts note that expectations of Federal Reserve rate cuts are now priced into markets, lifting gold demand. Economic Times reports that central banks have been aggressively adding bullion: on average purchasing over 1,000 metric tons per year recently.

This trend reflects reserve managers diversifying away from the dollar. Spot gold briefly hit $3,508.50/oz on Sep. 2, 2025. Gold ETFs saw record inflows as well – for example, the SPDR Gold Trust’s holdings climbed to 977.68 tons, the highest since 2022.

By many measures, gold remains low-volatility relative to equities. It trades with only 14% correlation to the S&P 500, compared to Bitcoin’s 60%.

In other words, gold is acting more like a traditional hedge again threatening the digital gold narrative. Over multi-year spans, gold has outperformed Bitcoin too.

Since the November 2021 highs, gold is up 85% versus Bitcoin’s 61%. An  analysis by analyst Bob Elliott underscores this: gold has delivered similar returns to Bitcoin since early 2021 but with one-quarter the volatility and much smaller drawdowns.

Bitcoin Underperforms Under Trump 2.0

Bitcoin’s 16% YTD gain is modest given its volatility. By comparison, it shot up over 400% in late 2017, and even during Trump’s first term in 2017 it saw a 411% run.

In this year’s Bitcoin news, Bitcoin has shown resilience amid macro uncertainty – for instance, it recovered from a spring dip of 32% – but it has not matched gold’s stride.

On-chain data suggest Bitcoin’s network activity is relatively sluggish. Data suggests active addresses recently fell to around 690,000, and transaction fees remain low.

Meanwhile, there are signs of large holders reallocating: “Lookonchain” data tracked a whale selling 425 BTC ($46.5M) and buying 10,500 ETH instead. Such moves hint that some investors may be rotating into other crypto plays or taking profits.

Bitcoin’s correlation with traditional markets has also increased. A recent analysis points out that since about 2020, Bitcoin has moved more with the Nasdaq and S&P 500 than in the past.

Digital Gold Narrative Under Scrutiny

Together, these trends put pressure on Bitcoin’s “digital gold” narrative. Proponents have long touted BTC’s fixed supply (21M cap) and halving cycles as parallel to gold’s scarcity.

Indeed, each Bitcoin halving reduces new supply to a tiny fraction. But supply-side scarcity is only half the story. As economist Jacques Bughin observes, if crypto is largely held by speculators and traded like a risk-on asset, it will behave like one.

Today Bitcoin news appears driven by leveraged demand (ETFs, hedge funds, futures) rather than the steady reserve demand that underpins gold. As Bughin notes, in 2025 BTC’s equity-market beta (sensitivity) is higher than ever, meaning its price amplifies stock moves rather than hedges them.

Gold’s stability underscores the contrast: investors and central banks hold gold as a store of value, which keeps its beta low.

Bitcoin’s beta is the opposite – studies find it is now greater than 1.0, sometimes above 2.0. In practical terms, Bitcoin tends to rise in rallies but also fall hard in sell-offs, much like a tech stock.

In the first half of 2025, for example, Bitcoin briefly hit $109k in January and is now back near $111k, only a 9% gain over Trump’s 2025 inauguration – a far cry from 2017’s huge Bitcoin news.