For years, Bitcoin was hailed as “digital gold,” a hedge against inflation and policy gluts.
But as geopolitical tensions rise and trade disputes return to the news, the original store of value, gold, is stealing the spotlight.
According to TradingView factsGold climbed to a record high of $4,376 per ounce on October 17, pushing its market capitalization above $30 trillion.
That makes the yellow metal roughly 14 times larger than Bitcoin’s current valuation of $2.1 trillion and more valuable than all seven of the world’s largest tech companies, including Apple, Microsoft and Nvidia.
Year to date, gold has gained an astonishing 60%, easily surpassing both the S&P 500’s 14% and Bitcoin’s 17%.
Why is gold rising?
The increase follows renewed trade tensions after US President Donald Trump announced plans for tariffs on China.
The move shocked global markets and revived demand for traditional hedges. Gold, already supported by months of central bank accumulation, became the asset of choice for investors seeking protection from currency and policy risks.
Jurrien Timmer, Director of Global Macro at Fidelity, said:
“Gold is in high demand as countries look to diversify from the hegemony of the US reserve currency. We can see that the share of reserves in gold has steadily increased and is now as large as reserves in euros. Hard money is taking market share from fiat money, and the dollar is losing market share against gold.”
The available data support this view. According to Token Terminal factstokenized gold products on Ethereum are up more than 100% this year to over $2.4 billion.
This growth is reflected in Tether Gold (XAUT)whose market capitalization has more than doubled this year, from $650 million to $1.6 billion.
At the same time, the analysis platform is CryptoRank estimates that gold inflows since January 2024 have exceeded Bitcoin’s value by more than $15 trillion, reflecting the strength of the institutional shift toward the precious metal.
Why Bitcoin is Falling
The same forces pushing gold higher appear to be weighing on Bitcoin, the largest crypto asset by market cap.
According to CryptoSlate According to data, the BTC price has fallen more than 4% in the past 24 hours, briefly falling to the lowest level since June at $103,300 before recovering to $106,051 at the time of writing.
Still, this price performance marks a 16% decline from the digital asset’s all-time high of $126,173.
Bitget Wallet CMO James Elkaleh shared CryptoSlate that the market pullback reflects short-term panic, not structural weakness. He describes the dip as “early panic-induced selling” caused by rate-related shocks.
As a result, Coinperps facts indicates that market sentiment has returned sharply to ‘fear’. Notably, this matches levels last seen in April, when Bitcoin was trading below $80,000.
Meanwhile, Elkaleh argued that Bitcoin would come out on top in the politically charged market environment due to its core value proposition as a non-sovereign hedge against policy risks and currency decline.
According to him:
“Bitcoin remains a hybrid asset. In the early stages of macro shocks, it trades like risky tech stocks and sells alongside other high-beta assets.
But as liquidity conditions improve and confidence in traditional markets weakens, it often shifts to a safe haven role, taking advantage of steady supply, global accessibility and separation of state-issued money.”
