In 2025, investors have arrived at a surprising consensus regarding their asset preferences, leading to a notable underperformance of Bitcoin, which currently sits at approximately $87,565.91. This year has highlighted a stark comparison among major assets, including stocks, gold, the 10-year Treasury note, Bitcoin, and copper, revealing a distinct shift in investor sentiment towards more tangible investments.
Gold, historically viewed as a safe haven and inflation hedge, has surged by an impressive 70%, reaching a record high of over $4,450 per ounce. This remarkable increase has outpaced all other major assets by a significant margin. Meanwhile, copper, often considered a reliable indicator of global economic health, has also seen robust gains, climbing 35%. In contrast, despite gains in the S&P 500 and Nasdaq of 17% and 21% respectively, the 10-year Treasury note has declined by 9%, and Bitcoin has dropped by 6%. Additionally, the dollar index, which tracks the value of the U.S. dollar against a basket of currencies, has fallen nearly 10%.
The performance of gold and copper in this environment appears to highlight a growing preference for tangible assets amid ongoing macroeconomic and political uncertainties, as well as a burgeoning AI-related boom. Early in the year, there was considerable bullish sentiment around Bitcoin, fueled by macroeconomic concerns, political issues, and fears of fiat debasement—paired with a more favorable regulatory outlook. However, this optimism has not translated into the expected performance for Bitcoin.
Markus Thielen, founder of 10x Research, pointed out that Bitcoin’s branding as “digital gold” has not resonated with Wall Street investors as intended. He suggested that many crypto discussions aimed at institutional investors are perceived as passive investment strategies, focusing on yield generation and long-term value preservation rather than compelling growth-driven narratives. Consequently, there appears to be insufficient interest in passive crypto investments, limiting fresh capital influx into Bitcoin.
As investors turn to gold amidst rising fiscal concerns, tariff-driven political tensions, and potential threats to the Federal Reserve’s independence, Bitcoin remains sidelined. The ongoing AI boom seems to have bypassed Bitcoin, even though it has significantly benefited various tech stocks and contributed to record highs in base metals like copper. The latter has been buoyed by trends in electrification and digital infrastructure, alongside geopolitical tensions and reduced supply growth.
Greg Magadini, director of derivatives at Amberdata, emphasized the lack of significant sovereign demand for Bitcoin, attributing its underwhelming performance to its positioning as a speculative asset rather than a foundational one like gold. He explained that while gold acts as a “hard asset” for global central banks, Bitcoin appeals more to individual investors and high-risk tolerance groups. He further noted that for Bitcoin to demonstrate substantial growth, sovereign adoption is necessary since current bullish factors like ETF approvals and a positive regulatory environment are already factored into its price.
Gold’s recent ascent has been significantly driven by increased purchases from global central banks, particularly in Asian nations. According to the World Gold Council, 254 tons of gold were acquired from January to October of this year, reflecting a heightened demand for this precious metal.
Despite the current challenges facing Bitcoin, some analysts suggest that its position is not entirely bleak. Lewis Harland from Re7 Capital indicated that Bitcoin’s recent stagnation could be a precursor to a significant rally. He noted that gold has consistently led Bitcoin’s trends, and its recent strength reflects broader market concerns about currency debasement and fiscal pressures, which historically have favored both gold and Bitcoin. Harland argued that as Bitcoin solidifies its position, it may be set to respond powerfully once the prevailing market conditions shift towards heightened fiscal strain.
The divergence in performance between gold, copper, and Bitcoin suggests that investors are navigating two conflicting narratives: one driven by potential AI growth linked to industrial metals and another steeped in fears of systemic risks associated with escalating fiscal debt. The stark contrast in performance, especially with gold and copper reaching record highs while other assets underperform, indicates a significant loss of trust in fiat currencies and a marked preference for tangible assets during these unpredictable times. This trend may reflect a broader concern over the stability of the global financial system, signaling that tangible assets are increasingly viewed as a safer harbor amid swirling economic uncertainties.
