The bitcoin-to-gold ratio declined sharply by 50% in 2025, dropping from around 40 ounces of gold per bitcoin in late 2024 to about 20 ounces by year-end. This trend underscores gold's strong performance as a safe-haven asset while bitcoin faced headwinds. According to Cointelegraph, gold outperformed bitcoin significantly, gaining 63% year-to-date and surpassing $4,000 per ounce.
Understanding the bitcoin-Gold Ratio
The ratio measures how many ounces of gold one bitcoin can buy. It fell due to gold's surge and bitcoin's relative underperformance.
In December 2024, the ratio stood at 40, but by Q4 2025, it halved amid diverging market dynamics. This reflects broader shifts in investor preferences within the market.
How the Ratio Evolved in 2025
Starting the year strong, bitcoin peaked near $126,000 in October, but then declined over 30%. Gold, meanwhile, rose steadily, driven by global factors.
The ratio's drop signals bitcoin's challenges in centralized finance ecosystems, where institutional flows favored traditional assets.
Key Factors Behind Gold's Surge
Central banks accumulated 254 tonnes of gold through October, boosting demand. This diversification from US Treasuries propelled gold prices higher.
Geopolitical risks rose 34% in indices, enhancing gold's safe-haven appeal. Its correlation with equities turned negative at -0.12, the lowest since 2008.
Central Bank Buying and ETF Inflows
Global gold ETF holdings increased by 397 tonnes in the first half of 2025. Institutions viewed gold as portfolio insurance amid tight monetary conditions.
Bloomberg's Mike McGlone noted the bitcoin-gold cross dropped 40% to 21x, questioning what might halt further declines.
Challenges Facing bitcoin in 2025
Elevated real yields raised the opportunity cost of holding bitcoin. Its correlation with equities remained high, exposing it to stock volatility.
bitcoin ETFs saw assets under management fall from $152 billion to $112 billion. Long-term holders sold off, weakening demand in the latter half.
Macro Pressures and market Volatility
The VIX averaged 18.2, up from 14.3 in 2024, signaling increased uncertainty. bitcoin underperformed as crypto-native traders exhausted capital.
Forced liquidations and AI bubble fears contributed to bitcoin's decline below $100,000 in November.
Expert Insights and market Sentiment
Peter Schiff stated on X that gold is eating bitcoin's lunch, with bitcoin down 32% priced in gold since August. This highlights the brutal bear for holders.
JPMorgan analysts reported bitcoin failed to benefit from safe-haven flows that boosted gold, with $21.1 billion in gold ETF inflows in Q1.
Doctor Profit emphasized bitcoin lost 50% of its value against gold since January 2025. This agreement points to bitcoin's overvaluation relative to gold.
CRYPTOBIRB observed holding bitcoin lost 1.69% year-to-date, while gold rose 55%. This underperformance marks a historic shift in the bull cycle.
Implications for CeFi and Crypto Markets
In centralized finance, bitcoin's struggles contrast with gold's resilience, affecting ETF strategies and institutional allocations. The may see rotations as volatility persists.
Analysts predict potential bitcoin recovery if the trend reverses in 2026, but current data favors gold in uncertain times.
This decline in the bitcoin-to-gold ratio reveals shifting dynamics in asset valuation. It underscores the need for diversified strategies in the evolving crypto and traditional markets.
