Bitcoin has gained just over 3% year-to-date, trailing gold's 9% jump. The precious metal reached a record high of US$2 882 an ounce after Trump on 4 February said the US could take over Gaza.
Bitcoin’s status as a store of value has come under scrutiny as the cryptocurrency’s price performance lags behind gold amid a surge in demand for safe havens, driven by Donald Trump’s return to the White House and geopolitical tensions.
After outperforming most asset classes in 2024, bitcoin has gained just 3% year-to-date, lagging behind gold’s 9% rise. The precious metal hit a record high of US$2 882 an ounce on 4 February after Trump said the US could take over Gaza — a comment his aides later sought to downplay. Bitcoin is currently about 10% below its peak.
While bitcoin has been touted as a store of value, similar to gold, due to the cryptocurrency’s built-in scarcity — its supply is capped at 21-million — the token has not lived up to the billing.
Gold’s enduring appeal during times of economic turmoil, such as the US-China trade war and threat of tariffs, has amplified its price performance. In contrast, bitcoin has often moved in near-lockstep with technology stocks.
Aoifinn Devitt, senior investment adviser at Moneta Group, said in an interview that while bitcoin could be considered a hedge against fiat currency, its appeal is muted in a market where the US dollar remains in high demand.
“In time it will have its own characteristics that act separate and apart from markets but at this point it is behaving as the riskiest of risk-on assets,” he added.
However, bitcoin proponents hope that the token’s intrinsic qualities will eventually see it behave more like a store of value.
Paul Howard, senior director at market maker Wincent, said the advent of exchange-traded funds that invest directly in the largest digital asset will “gradually decrease volatility and likely see investors chasing volatility move to more riskier cryptocurrency assets”. — Sidhartha Shukla, (c) 2025 Bloomberg LP
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