Bitcoin News Today: Bitcoin Challenges King Gold as Dollar Weakness Drives Investor Rotation

Bitcoin's potential undervaluation against gold and the U.S. dollar's weakening trajectory have positioned the cryptocurrency for a possible fourth-quarter (Q4) rally, according to recent market analysis. Precious metals, including gold and silver, have surged to record highs in 2025, with gold reaching $4,000 per ounce and silver hitting a 45-year high above $50 per ounce. However, analysts argue that these gains may signal an overextended market, creating opportunities for investor rotation into alternative stores of value like Bitcoin (BTC) and tokenized real-world assets .

Gold's year-to-date rally of over 50%-coupled with Goldman Sachs' projection of $4,900 per ounce by late 2026-has raised concerns about momentum-driven speculation. Nic Puckrin, founder of Coin Bureau, noted that gold's surge resembles a "momentum trade" rather than a fundamentals-driven move, increasing the risk of a correction. He emphasized that Bitcoin and other assets remain undervalued relative to gold, offering similar inflation-hedging properties without the same level of market saturation .

The U.S. dollar's decline has further amplified demand for alternative assets. The dollar is on track for its worst annual performance since 1973, with its purchasing power dropping 40% since 2000. This devaluation has driven simultaneous inflows into both risk and safe-haven assets, a historically rare dynamic. Bitcoin's price has surged alongside gold, reaching a record $126,000 in October 2025. Analysts at the Kobeissi Letter attributed this to a "new era of monetary policy," where inflationary pressures and currency devaluation drive capital into assets perceived as more resilient .

Technical analysis of the Bitcoin-gold ratio (BTC-XAU) also supports a potential breakout. The ratio has consolidated within an ascending triangle since 2017, with the current level of 31.2 ounces of gold per Bitcoin significantly lower than the 40-ounce average in December 2024. This compression suggests a narrowing of the gap between the two assets, with analysts forecasting a possible upward trend as gold's momentum wanes. Historical precedents, including sharp corrections in 2019, 2020, and 2022, indicate that Bitcoin often gains traction during gold's overbought phases .

Institutional demand for Bitcoin-linked products has further reinforced its role as a digital safe haven. Global crypto exchange-traded products (ETPs) have attracted $48.67 billion in inflows year-to-date 2025, with Bitcoin accounting for 62% of the total. While gold's dominance in this space has waned, tokenized gold and Bitcoin's combined appeal-rooted in scarcity, liquidity, and decentralization-has drawn renewed attention. Matt Hougan, chief investment officer at Bitwise, highlighted that Bitcoin's surge in Q4 is likely driven by investors seeking to preserve wealth amid currency debasement and geopolitical uncertainty .

The broader macroeconomic environment underscores this shift. Governments have expanded deficits and money supply amid inflation above target levels, eroding confidence in fiat currencies. Japan's new prime minister, Sanae Takaichi, has advocated for increased public spending and tax cuts, further stoking fears of yen depreciation. Meanwhile, the U.S. dollar index (DXY) has weakened, correlating with Bitcoin's price gains. This trend aligns with historical patterns where capital rotates from gold to Bitcoin during peak gold cycles, as seen in 2017 and 2020 .

However, challenges remain. Tokenized gold, which now commands a $3 billion market cap, has emerged as a hybrid alternative, combining physical gold's store-of-value properties with blockchain-based programmability. While Bitcoin advocates argue its trustless nature and decentralized structure give it an edge, critics highlight tokenized gold's potential to replicate gold's traditional appeal with added utility. The debate over which asset deserves the "digital gold" moniker continues, but Bitcoin's market performance and institutional adoption suggest it is well-positioned to benefit from ongoing monetary shifts .

[1] Cointelegraph, [https://cointelegraph.com/news/precious-metals-trade-overheated-investors-rotate-btc](https://cointelegraph.com/news/precious-metals-trade-overheated-investors-rotate-btc)

[2] Yahoo Finance, [https://au.finance.yahoo.com/news/gold-outshines-2025-bitcoin-gold-082518497.html](https://au.finance.yahoo.com/news/gold-outshines-2025-bitcoin-gold-082518497.html)

[9] BeInCrypto, [https://beincrypto.com/bitcoin-tokenized-gold-3-billion-digital-gold/](https://beincrypto.com/bitcoin-tokenized-gold-3-billion-digital-gold/)

[11] Ambcrypto, [https://ambcrypto.com/bitcoin-vs-gold-will-2025-mark-the-start-of-a-supercycle/](https://ambcrypto.com/bitcoin-vs-gold-will-2025-mark-the-start-of-a-supercycle/)