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Bitcoin was long considered a digital counterpart to gold. However, while the precious metal is reaching new all-time highs, Bitcoin is experiencing an unusual period of relative weakness. At the same time, tokenized commodities are emerging as an on-chain alternative, reshaping capital flows within the crypto ecosystem. A closer look at the data reveals how the balance of power is shifting.
Gold Shines While Bitcoin Struggles — at Least in the Short Term
Gold is experiencing one of the strongest years in its history. Driven by geopolitical tensions, expectations of monetary easing, and aggressive central bank buying, the gold price climbed above $4,370 per ounce by the end of 2025. Bitcoin, by contrast, has failed to keep pace.
As of December 19, 2025, Bitcoin’s year-to-date performance ranged between –5.5% and –14%, while gold gained roughly 65% over the same period. Bitcoin also significantly underperformed traditional risk assets such as the S&P 500 and Nasdaq 100.
Context matters: According to a recent report by research firm Messari, this divergence should be viewed as a short-term phenomenon rather than a structural breakdown of Bitcoin’s long-term thesis.
The Breakdown of the Bitcoin–Gold Ratio
More revealing than the comparison in U.S. dollars is the Bitcoin-to-gold ratio (BTC/XAU). This ratio peaked in December 2024 but has since declined by nearly 50%.
Meanwhile, gold continued to post new highs against the U.S. dollar. With an estimated market capitalization of around $30 trillion, gold remains by far the largest non-sovereign monetary asset in the world. Bitcoin still represents only a fraction of that valuation.
This raises a critical question posed by Messari: how compelling is Bitcoin’s “digital gold” narrative if it fails to outperform during a strong gold cycle?
Bitcoin Does Not Behave Like Gold — and That Matters
A key insight from Messari’s analysis lies in correlation data. Between March 2020 and April 2025, Bitcoin’s correlation with gold was just 0.18. Over the same period, Bitcoin showed a significantly stronger correlation with equity indices such as the S&P 500.
This helps explain why Bitcoin did not benefit from the classic flight-to-safety dynamic in 2025. While gold was supported by geopolitical risk and central bank demand, Bitcoin was increasingly treated as a macro-sensitive asset—vulnerable to liquidity cycles, profit-taking, and shifts in risk appetite.
This dynamic challenges the simplified “digital gold” narrative without invalidating Bitcoin’s long-term role in the global financial system.
Tokenized Gold Emerges as an On-Chain Alternative
A new competitor has also entered the spotlight: tokenized precious metals. By the end of November 2025, the market capitalization of tokenized commodities surged by 244%, reaching approximately $3.6 billion. The majority of this growth came from gold-backed tokens such as Paxos Gold (PAXG) and Tether Gold (XAUT).
According to data from CryptoRank, PAXG and tokenized silver products like KAG clearly outperformed Bitcoin in 2025. The rotation accelerated between October and December, coinciding with one of the sharpest increases in crypto market fear since 2022.
Crucially, capital did not leave the blockchain ecosystem—it rotated within it. Tokenized precious metals effectively became the first crypto-native hedge, allowing investors to seek real-asset exposure without exiting on-chain markets.
Schiff vs. Zhao: A Debate That Divides the Market
The identity crisis sparked by this shift was highlighted during a public debate between Binance founder Changpeng Zhao and long-time Bitcoin critic Peter Schiff at Binance Blockchain Week 2025.
Schiff argued that Bitcoin has lost significant purchasing power when measured in gold:
Four years ago, one Bitcoin could buy over 37 ounces of gold—today, it buys roughly 22 ounces, implying a loss of about 40% in gold terms.
Zhao countered that Bitcoin is increasingly traded as a global macro asset, and that this flexibility underpins its long-term value. Tokenization, he argued, expands the market rather than undermines Bitcoin.
Why Bitcoin Is Increasingly Treated as a Macro Asset
Despite the short-term underperformance, Messari remains constructive on Bitcoin’s long-term outlook. Analysts attribute the divergence primarily to structural changes. Bitcoin is now more liquid, more regulated, and more accessible through ETFs than ever before. Large positions can be sold without the same degree of market disruption seen in earlier cycles.
At the same time, the classic four-year cycle model is losing explanatory power. Bitcoin’s price is increasingly shaped by macroeconomic variables such as monetary policy, geopolitical risk, and institutional capital flows.
Messari’s core thesis therefore remains intact: over multi-year and multi-decade horizons, Bitcoin is still expected to undergo monetary appreciation—even relative to gold.
What the Gold–Bitcoin Divergence Means for Investors
The events of 2025 demonstrate that Bitcoin does not automatically benefit from every gold rally. Gold continues to fulfill its role as a safe haven, while Bitcoin is currently perceived more as a macro- and risk-sensitive asset. What is new, however, is that investors can now rotate into real-value anchors within the blockchain economy itself.
For investors, the picture has become more nuanced. Gold is clearly benefiting from geopolitical uncertainty and sustained central bank demand. Bitcoin remains a long-term bet on the adoption of digital money but reacts more strongly to short-term liquidity cycles. Tokenized precious metals are increasingly occupying a middle ground—combining the characteristics of traditional hard assets with blockchain-based infrastructure.
Bitcoin has not failed—but the “digital gold” narrative has become more complex and demands a more differentiated analysis.
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