Bitcoin Struggles as Gold Hits Record High, Crypto Market Pulls Back

Bitcoin has recently faced significant challenges, struggling to surpass the $84,000 resistance level amidst a broader crypto market pullback. Meanwhile, gold has surged to a record high of $3,000 per ounce, highlighting a stark contrast in performance between the two assets. This shift has raised questions about the sustainability of the current crypto bull run.

The year 2025 has been tumultuous for Bitcoin, with the cryptocurrency experiencing a decline of over 10% year-to-date, dropping from approximately $94,000 in January to around $84,000. In contrast, gold has seen a nearly 13% increase during the same period, underscoring its resilience and appeal as a safe-haven asset.

Market analysts have noted that Bitcoin is beginning to breach a critical support line against gold, a trend that has held for over a decade. This development, if sustained, could signal the end of the current crypto bull run. The underperformance of Bitcoin relative to gold is further evidenced by the contrasting capital flows into their respective exchange-traded funds (ETFs).

US-based spot gold ETFs have attracted significant inflows, exceeding $6 billion year-to-date, while globally, spot gold ETFs have seen over $23 billion in inflows. Conversely, US-based spot Bitcoin ETFs have experienced nearly $1.5 billion in net outflows, indicating a shift in investor sentiment towards risk-off assets. Several factors, including new trade tariffs, hawkish monetary policies, and recent stock market volatility, have contributed to this aversion to risk-on assets.

The underperformance of Bitcoin relative to gold has cast doubt on the longevity of the current crypto bull market. The total crypto market cap has decreased by over $600 billion since the start of the year, now standing at approximately $2.8 trillion. Renowned gold advocate Peter Schiff argues that Bitcoin has been in a bear market for the past three years, with its value in terms of gold having fallen by 24% since its peak in 2021.

However, positive macroeconomic developments could still turn the tide in Bitcoin's favor. Cooling US inflation may pressure the Federal Reserve to pivot towards quantitative easing, boosting market liquidity and potentially benefiting risk-on assets. Additionally, a breakdown in the US dollar index could reignite optimism for assets like stocks and cryptocurrencies. At the time of writing, Bitcoin is trading at $84,902, up 3.8% in the past 24 hours, suggesting that the market remains dynamic and subject to rapid changes.