Gold’s Traditional Role as a Safe Haven Asset
For decades, gold has held its position as the ultimate safe haven during times of financial turmoil. Alongside government bonds, it formed the bedrock of the classic 60/40 portfolio strategy, offering stability when equities fell.
But 2025 is not the same market. With geopolitical risks, rising inflation, and distrust in central banks, investors are beginning to question whether gold still meets the criteria for downside protection.
The Rise of Bitcoin as a New Contender
Enter Bitcoin. Despite its volatility and speculative reputation, Bitcoin has soared over 1,000% since the COVID-19 crash of 2020, while gold is up around 90%. However, when adjusted for monetary debasement, even gold’s gains start to look weak.
During several major macro shocks, Bitcoin has shown increasing resilience:
- March 2020 (COVID crash): BTC -40%, QQQ -27%
- March 2023 (bank crisis): BTC -14%, QQQ -7%
- August 2024 (yen carry trade unwind): BTC -20%, QQQ -6%
- April 2025 (tariff-led selloff): BTC -11%, QQQ -16%
Unlike earlier events, Bitcoin outperformed the Nasdaq during the most recent tariff-induced drop—marking a shift in its market behavior.
Bitcoin vs. Gold in Today’s Environment
While Bitcoin still lacks the low volatility traditionally associated with gold, it offers unique advantages:
- Decentralization
- Global liquidity
- Tariff immunity
- Censorship resistance
In a world grappling with financial repression, currency debasement, and sovereign risk, these qualities are increasingly relevant.
According to NYDIG Research, “politically neutral assets like Bitcoin should perform well amid geopolitical instability.”
Gold’s Performance Losing Its Shine
Despite reaching new highs, gold’s 2025 drawdown reflects its limitations. In the latest sell-off:
- Gold fell 3%
- Bitcoin dropped 6%
- TLT (long-term bonds) lost 4%
- Nasdaq plunged 10%
The traditional safe haven trio—gold, bonds, and the U.S. dollar—have struggled to meet investor expectations. The 10-year Treasury yield has surged nearly 8%, making bonds less attractive.
A New Definition of Safe Haven?
Bitcoin is volatile, yes—but it also seems to set new long-term floors after each crisis:
- $4,000 in 2020
- $20,000 in 2023
- $49,000 in 2024
Now, even with the latest drop, Bitcoin’s trajectory suggests resilience. Its unique features could redefine what safe haven means in today’s evolving markets.