Bitcoin Vs. Gold: Which Is the Better Investment Right Now

So far, gold has significantly outperformed Bitcoin (CRYPTO: BTC) in 2025. This year, gold has increased by 30% and is currently trading at an all-time high. Amid all the uncertainties regarding tariffs, investors are seeking safe havens to preserve the value of their money, and gold is considered the safest haven among all safe havens. But don't sleep on Bitcoin. The "digital gold" story is coming back and Bitcoin has recently regained the $90,000 price level for the first time in weeks. So what is the better investment right now: Bitcoin or gold? The unique diversification characteristics of Bitcoin In September 2024, BlackRock (NYSE: BLK) published a 10-page brief: "Bitcoin: A Unique Diversification Tool." The report examined the unique diversification characteristics of Bitcoin as a scarce, decentralized, and non-sovereign global asset. Ultimately, BlackRock concluded that Bitcoin does not fit within the traditional framework of "risky" and "safe" assets. Yes, Bitcoin carries risks in the sense that it is still a relatively new technology with an uncertain management future. And yes, Bitcoin has risks due to its high volatility. But the issue here is: Bitcoin also has many characteristics similar to those you would expect to find in a safe-haven asset like gold. Most importantly, Bitcoin in history has not correlated with any major asset, making it a potential hedge against falling stock prices. Furthermore, as a global asset completely outside the control of sovereign governments and central banks, Bitcoin is not bound to the economic fate of any nation. Is Bitcoin a safe haven? As BlackRock has pointed out, Bitcoin can serve as a safe haven during periods of economic and geopolitical instability. To emphasize this point, they examined six recent events that have "shocked" the global financial system ( such as the outbreak of COVID-19 and the onset of the Russia-Ukraine war in 2022), to see how both gold and Bitcoin reacted to these major geopolitical events. If you don't look at the numbers, you might guess that gold performs much better than Bitcoin in both the short term (10 days) and the long term (60 days). But you would be wrong. As BlackRock has found, Bitcoin often has a temporary negative reaction before suddenly soaring. In five out of six cases examined, Bitcoin performed better than gold over a 60-day period. And in three out of six cases, it also performed better than gold over a 10-day period. Does it sound familiar? It seems that a similar situation is happening with tariffs. Gold initially outperformed Bitcoin when tariffs were first announced, but now Bitcoin is starting to gain momentum. From the perspective of some investors today, Bitcoin could really be a safe haven, especially if economic instability leads to geopolitical instability. The only chart that says it all All the discussions about gold outperforming Bitcoin in 2025 have made many investors forget about Bitcoin's incredible performance over the past decade. In seven out of the last 10 years, Bitcoin has been the best-performing asset in the world. However, investing is often a game of "what have you done for me lately", so let's compare the performance of Bitcoin and gold over the past year. For the argument, use the iShares Bitcoin Trust (NASDAQ: IBIT) from BlackRock to represent the price of Bitcoin and the iShares Gold Trust (NYSEMKT: IAU) from BlackRock to represent the price of gold.

According to data from TradingView, Bitcoin has outperformed gold since the iShares Bitcoin Trust launched in January 2024. During that time, the Bitcoin ETF has increased by 116%, while the gold ETF has risen by 68%. Even as the value of Bitcoin has decreased this year and the value of gold has surged, the Bitcoin ETF has still outperformed the gold ETF. What will happen next with Bitcoin? The chart clearly shows the inflection point of Bitcoin around the "Liberation Day" on April 2. After weeks of sideways trading, Bitcoin suddenly surged in price. Amid discussions about the global trade war and the new spat between the White House and the Federal Reserve regarding interest rates, this price increase could become even more pronounced. If recent history is any guide, Bitcoin is the only asset you want to hold during periods of economic and geopolitical instability. The fact is, Bitcoin is much less risky than many imagine. And it can often outperform gold, even when you least expect it. Therefore, even after a less than stellar start to the year, Bitcoin may still outperform gold by 2025.