Gold vs. Bitcoin: Volatility Crushes Crypto as Gold Shines on Geopolitical Risks

Gold (XAU) and Bitcoin (BTC) are assets in the global market that attract investors in times of uncertainty. However, the price behaviour of these assets has changed during the past few months due to clear divergence. The chart below shows that the price of Bitcoin declined in the last quarter of 2025 but the price of gold continued to rise due to demand for safe-havens.

Bitcoin Volatility Weighs on Corporate Balance Sheets

The recent development in the cryptocurrency market has increased the vulnerability for Bitcoin as the market is showing sharp swings. Strategy Inc. (MSTR) had heavy unrealized losses of $17.44 billion in the last quarter of 2025. Moreover, the losses for the whole year ending on 31 December 2025 amounted to $5.40 billion.

This uncertainty had a direct effect on the equity market. The shares of MSTR have fallen to around 47.5% in 2025. This drop represents the concern of investors about the exposure of the company to price swings of Bitcoin. Therefore, the company downgraded the earnings forecasts for 2025 in December because of the poor performance of Bitcoin. Despite these challenges the company has a reserve of $2.25 billion to pay for dividends and debt.

Gold Benefits From Increased Geopolitical Risk

Despite uncertainty in crypto-linked companies and geopolitical tensions, the overall markets are strong. The S&P 500 shot to record levels in 2025. Moreover, the world risks are high with the problems in Venezuela, uncertainty over Russia and Ukraine, unrest in Iran and prolonged instability in Gaza.

This environment is conducive for the gold market because investors consider the metal as a hedge to geopolitical shocks. The appeal of gold has been reinforced further due to the expectation for more flexible monetary policy. The market is looking forward to a possible Fed rate cut in March and a second cut in the second half of 2026.

Bitcoin and Gold Technical Analysis

The weekly chart for Bitcoin shows the price recovering after consolidation around the rising trend line. This rebound underlines the importance of this support in the Bitcoin market and suggests a move to the 100k level. A break above the 100k level will mean more upside in Bitcoin prices. However, a break below 80k will imply a deeper correction in the Bitcoin market towards the 60k to 70k.

On the other hand, the spot gold market has broken the symmetrical triangle pattern and taken prices to the $4,550 level before launching a strong correction during the last week of 2025. The gold market is consolidating at the overbought level and looking for the next direction.

The strong resistance still remains the resistance of the ascending broadening wedge pattern and breaking above the $4,500 level will trigger a strong surge in gold prices. However, if the overbought conditions push the prices lower then the $4,000 level will be the key support in the gold market.

The gold market is probably headed towards the $5,000 in the year 2026. However, the question now remains as to whether the gold should correct before the next move higher due to the extremely overbought conditions.

Gold-to-Bitcoin Ratio Speaks for Itself

The Bitcoin to gold ratio broke below the triangle pattern in October 2025 and triggered a massive correction to the 20. The ratio continues to fall, which is a sign of Bitcoin weakness as compared to gold.

A rebound in the ratio will show that Bitcoin is finding support at the rising trend line. But a break below 20 level in the ratio will open the door for further downside in Bitcoin.

Despite the breakdown in the ratio, the weekly chart shows that the ratio has approached the strong support level at the 20 level. This support is defined as the midline of the ascending channel. As long as the ratio maintains the 20 level, the ratio has the potential to trigger a rebound.

This rebound will likely be supportive for the Bitcoin market and Bitcoin prices may initiate a rebound towards the 100k level. However, a break below the 20 level will also break the middle point of the channel and start further downside in the Bitcoin market.

Conclusion: Two Assets, Very Different Roles

Bitcoin bounces from the strong support at $80,000 but the price needs to break over $100,000 to confirm the bottom. On the other hand, the gold market is also strong and keeps rallying because of the geopolitical tensions. The ratio between Bitcoin and gold has hit the strong support of 20. As long as the support level of 20 holds, there is the potential for Bitcoin price to form a bottom and move higher. However, a break below 20 will suggest more downside in Bitcoin and continuation of the upside in gold.