Gold vs. Bitcoin: Diverging Paths as Tether Fuels the Next Big Gold Move

Bitcoin (BTC) remains under bearish pressure amid a broader risk-off mood across global markets. S&P 500 (SPX) pulled back from record highs to touch the 6,550 level, while Asian and European markets opened mixed to lower. However, the S&P 500 has rebounded after marking a low, which is helping Bitcoin initiate a recovery. Despite the pressure on Bitcoin, gold (XAU) prices remain strong and continue to build positive momentum in Q4 2025.

Gold Takes the Lead as Bitcoin Momentum Fades

Over the past few months, Bitcoin and gold have moved higher in tandem, supported by investor concerns surrounding inflated tech stocks and AI bubbles. The U.S. government shutdown also pushed both assets to record highs. However, Bitcoin and gold have now diverged. Gold is building a strong bullish structure and looks ready to break higher, while the entire crypto market has lost more than $1 trillion since peaking in October.

Moreover, gold has delivered a historic performance in 2025, with prices rising more than 50%. This surge marks the metal’s most extraordinary year in over 4 decades. On the other hand, Bitcoin is struggling under the weight of fading enthusiasm for ETFs. The launch of Bitcoin ETFs initially attracted retail investors, but as prices declined, capital quickly flowed out. The chart below highlights the scale of ETF outflows over the past few days.

Tether’s Massive Gold Purchases Fuel the Market’s Rally

Another significant force behind gold’s surge in 2025 is Tether. While central banks were the main drivers of gold demand throughout the year, Tether quietly emerged as a top marginal buyer. Tether’s gold purchases in Q2 and Q3 exceeded those of individual central banks, acquiring a total of 116 tons, valued at approximately $14 billion. This places Tether in a category comparable to that of sovereign gold holders, such as South Korea or Hungary.

Furthermore, Tether bought 26 tons in October alone, representing 12% of all known central bank purchases for that month.

Gold-to-Bitcoin Ratio Breakdown Confirms Gold Outperformance Ahead

The chart below shows the growing divergence between Bitcoin and gold prices. Since October, Bitcoin has started to decline, while gold has remained strong. Over the past 12 months, gold has posted solid gains, whereas Bitcoin remains in negative territory.

This is further confirmed by the gold-to-Bitcoin ratio chart, which has traded within a descending channel since 2015. The ratio recently broke out of a descending channel and continues to trend higher. Since 2021, it has been supported above the black dotted trendline at 0.026.

The breakout in October 2025 signals an increase in upward momentum in the ratio. This positive structure suggests that gold is likely to outperform Bitcoin in the coming months. It also implies that Bitcoin prices may remain suppressed during the next major gold rally.

Moreover, the Bitcoin-to-gold ratio chart shows a breakdown from the triangle pattern in October 2025. This signals that Bitcoin prices may continue to fall in the coming weeks. A confirmed break below the 21 level will indicate sustained bearish pressure on Bitcoin. On the other hand, gold may remain bullish, as the ratio failed to break above the 40 level, a historical reversal zone on the long-term chart.

Spot Gold Eyes Next Leg Higher After Holding Support Zone

The weekly chart for spot gold indicates that the gold market remains within an ascending channel. The recent correction from the $4,400 level was due to extremely overbought conditions and has found strong support around the $3,900 area.

This support aligns with the lower boundary of the ascending channel pattern. The price is now reversing higher, and further consolidation above $3,900 will build positive pressure for continued upside in the gold market over the next few weeks.

This bullish price structure is also confirmed by the weekly chart below, which shows that the price has been trading within an ascending broadening wedge pattern. The recent consolidation within the symmetrical triangle resembles the patterns seen in the second quarter of 2025 and the last quarter of 2024. A breakout above this symmetrical triangle will likely trigger the next surge higher toward $5,000.