- Gold and other precious metals have surged this year while Bitcoin has failed to hold key levels.
- Investors cite rate-cut expectations, geopolitical risk and shifts into capital preservation as drivers for gold’s rally.
- Gold-backed ETF holdings show steady accumulation, and major banks have raised price targets for gold.
Gold has climbed sharply this year as bitcoin struggles to sustain gains, driven by rate-cut expectations and geopolitical concerns. Investors are treating gold as a go-to hedge while bitcoin remains sensitive to broader risk-on and risk-off swings. (Photo: image.)
Gold is up more than 70% year to date, and silver has rallied about 150%, putting both on pace for their strongest annual gains since 1979. Platinum has also reached record levels as investors rotate into precious metals.
Positioning has weighed on bitcoin. Traders are still working through a long period of leverage-led trading (use of borrowed funds to amplify returns), and recent rebounds met quick profit-taking. Macro volatility — including swings in bond yields and the dollar — has pushed markets into a capital-preservation mode that tends to favor gold first.
David Miller, chief investment officer at Catalyst Funds and portfolio manager of the Strategy Shares Gold Enhanced Yield ETF, said the gap between gold and bitcoin is notable. “Gold has had a record year, up over 60%. But bitcoin too. You still have this situation where it’s clearly not digital gold,” he said.
Miller added that bitcoin can still serve as a long-term hedge against fiscal expansion and currency debasement, but that gold acts differently because central banks treat it as a reserve asset. A reserve asset is a holding used by central banks to support a country’s currency value and financial stability. “What gold does that bitcoin definitely can’t is serve as an actual alternative reserve asset to a currency,” Miller said. “Bitcoin is really a retail play, whereas gold is very much institutional.”
Data from the World Gold Council shows holdings in gold-backed ETFs rose every month this year except May, indicating steady accumulation. Holdings in State Street’s SPDR Gold Trust have increased by more than 20% in 2025.
Several banks remain bullish. Goldman Sachs projected gold could reach about $4,900 an ounce in 2026 under its base case, with risks skewed higher. An ETF is an exchange-traded fund (a pooled investment that trades on exchanges like a stock).
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