Gold Just Had Its Worst Day in 12 Years — Is Bitcoin the Winner?

• On Tuesday, Gold plunged over 6%, its steepest drop in more than a decade, sparking speculation of shifting sentiment among crypto investors.
• Bitcoin is showing solid resilience near $107K, and a small capital shift of just 3–5% from gold is expected to be a powerful boost.

Gold’s meteoric rally hit a wall this week. After surging to a record $4,381 per ounce on Monday, prices plunged more than 6% on Tuesday, the steepest one-day drop since 2013. By press time, gold was trading near $4,093, with a market capitalization of $28.461 and an increase of nearly 60% in the past year.

This rippled through the metals market as well, silver and platinum, both up more than 60% this year and outpacing gold’s 54% gain, fell 6.7% and 7.2%, respectively, in the same session.

Veteran trader Peter Brandt underscored the scale of the move, noting that gold’s loss in market value was equivalent to 55% of the entire cryptocurrency market cap, wiping out roughly $2.1 trillion in a single day.

Analysts point to a combination of factors behind the sell-off: aggressive profit-taking after a parabolic rally, a strengthening U.S. dollar, easing geopolitical tensions, and growing doubts about gold’s status as a “safe haven” at such elevated levels.

The macro sentiment has shifted as optimism has grown over potential progress in resolving the U.S. government shutdown, which is now in its 22nd day, and a softer tone on trade policy toward China. The easing of tariff threats reduced demand for traditional hedges like gold.

A stronger dollar also made the metal more expensive for foreign buyers, amplifying the sell-off. While some traders see this as a healthy “flush” that clears out late buyers, others warn it could signal a deeper sentiment shift, nd possibly mark the start of a new phase for gold.

Bitcoin Rises

While the yellow metal tumbled, Bitcoin is trading around $107,000, just 14% below its recent peak above $126,000 earlier this month, and has seen a 4.71% drop in the past week.

This contrast has reignited a familiar debate: is Bitcoin emerging as the new alternative hedge, or is this just another short-lived moment of outperformance?

Investors believe that capital could be shifting away from traditional safe havens, such as gold, and moving into digital assets. Anthony Pompliano captured the sentiment, saying,

This has fueled speculation that investors are shifting their “store of value” preference from gold’s old guard to Bitcoin’s new frontier. But the reality is more nuanced. While Bitcoin has performed strongly, it still hasn’t completely decoupled from broader risk assets, nor has it consistently behaved like a true safe haven in moments of stress.

Earlier, CNF reported that central banks and institutions poured money into gold, driving the value of a $20 trillion asset up nearly 50%. Suppose a similar capital rotation were to happen with Bitcoin. In that case, the math becomes eye-opening: a $10 trillion inflow could expand Bitcoin’s market capitalization from $2.5 trillion to $12.5 trillion, resulting in a 400% price gain.

Even so, influential voices in the space see the tide turning. Hunter Horsley, CEO of Bitwise Asset Management, highlighted the improving risk-reward profile of Bitcoin relative to gold, noting that the BTC/Gold ratio is signaling renewed upside potential for crypto.

Changpeng Zhao offered an even bolder take, predicting that Bitcoin will eventually “flip gold” in value, though he acknowledged it may take time. “Gold won’t go to zero,” he added, “but Bitcoin is better.”