Bitcoin stumbles, Gold soars: the myth of Crypto as a ‘safe haven’ starts to crack

After a brief flash rally, the queen of cryptocurrencies is falling again while the yellow metal hits record performance. Here’s what is changing in the markets and why the “digital gold” narrative is beginning to wobble.

After just five days of fireworks, Bitcoin has resumed its downward slide: between 7:00 p.m. yesterday and 6:00 a.m. this morning it lost another 1%, stabilizing around $87,000. The move reflects a broader return of risk aversion: S&P 500 futures are down 0.19%, while markets in Europe and Asia are flat or slightly negative.

For months, Bitcoin and gold had moved in lockstep, fueled by the safe-haven narrative in a world shaken by fears of a tech bubble and macroeconomic uncertainty. The peak came during the U.S. government shutdown, when both “havens” hit new all-time highs. Even Deutsche Bank had floated the idea that Bitcoin might soon appear on central bank balance sheets as a reserve asset.

Today, however, that story feels distant. In just one month the two asset classes have taken opposite paths: while gold is racing toward a new record high, total crypto market capitalization has dropped 24% from October levels. Gold, meanwhile, is having its best year since 1979, up 50% since the start of 2025.

Two key forces explain the divergence. The first is the sharp reversal in Bitcoin ETFs: after an explosive debut, the cryptocurrency’s price decline has pushed hundreds of millions of dollars out of the funds, intensifying downward pressure. Every billion in outflows, Citi estimates, drags the price down by about 3.4%. The second involves an unexpected player: Tether. The issuer of the USDT stablecoin has ramped up its gold purchases to support the dollar peg, now accounting for 12% of annual central bank gold buying. And the more Bitcoin falls, the more investors retreat into stablecoins - indirectly boosting demand for bullion.

This is how a spiral forms: Bitcoin selling pushes funds into stablecoins, stablecoins absorb more gold, and the yellow metal continues to soar while Bitcoin falters. A gap that could - at least for now -reshape the myth of “digital gold.”

Andrea Pelucchi