Gold Tops $4,000 Amid U.S.-China Trade Tensions as Bitcoin Slumps; Schiff Says This May Undermine ‘Digital Gold’ Thesis

Is Bitcoin digital gold? Gold tops $4,000/oz as investors seek safety; Peter Schiff disputes the comparison. COINOTAG analyzes market drivers, data, and expert views.

Published: 2025-10-14. Updated: 2025-10-14. Author: COINOTAG.

• Gold hit historic highs above $4,000 per ounce, driven by inflation concerns and geopolitical risks.

• Bitcoin fell with risk assets during the same period, raising questions about its safe-haven properties.

• Institutional buying and central bank reserve accumulation underpin gold’s rise; World Gold Council and market reports note increased purchases.

Is Bitcoin digital gold?

Is Bitcoin digital gold? In the recent market episode where gold surpassed $4,000 per ounce and Bitcoin declined alongside equities, the evidence favored gold’s safe-haven narrative. Market behavior showed gold acting as a liquidity refuge while Bitcoin correlated more closely with speculative assets in the short term.

Why did gold surge above $4,000 per ounce?

Gold’s rise to more than $4,000 per ounce reflected a convergence of drivers: renewed inflation concerns, large-scale central bank reserve purchases, and heightened U.S.-China trade tensions. Official data and market trackers indicate that several emerging-market central banks increased holdings in recent months as insurance against currency and fiscal risks. Media reports on tariff threats and abrupt market moves on October 10 accelerated flows into bullion. World Gold Council commentary and institutional trading desks reported increased demand from ETFs and sovereign buyers during the rally.

How did Bitcoin behave during the same period?

Bitcoin initially showed a recovery but then slipped below key intraday levels, mirroring declines in equities and tech stocks. In this episode, Bitcoin’s price action suggested strong correlation with risk-on assets rather than a decoupling into a store-of-value role. Market observers noted ETF flows into Bitcoin may be one driver of demand, but the potential for rapid redemptions could quickly reverse this support, creating liquidity stress in moments of market stress.

Frequently Asked Questions

Can Bitcoin act as a hedge like gold during geopolitical crises?

Bitcoin has occasionally served as a partial hedge, but in the October episode it moved with risk assets rather than shielding portfolios. Historical performance shows inconsistent hedge characteristics versus gold, which has a longer record of crisis-driven inflows and central bank reserve use.

How should investors view Bitcoin versus gold right now?

For many investors, gold remains the preferred safe-haven for portfolio ballast and reserve accumulation. Bitcoin may offer diversification benefits but currently displays higher volatility and episodic correlation with speculative markets, so position sizing and risk management are imperative.

Key Takeaways

• Gold’s role as a safe haven: Gold’s record highs above $4,000/oz were driven by inflation worries, central bank purchases, and geopolitical friction.
• Bitcoin’s short-term behavior: Bitcoin’s decline alongside equities in this episode suggests it acted more like a risk asset than a reliable “digital gold.”
• Investor action: Consider distinct roles—use gold for defensive allocations and assess Bitcoin for growth or tactical exposure with strict risk controls.

Expert perspective

Market commentator Peter Schiff emphasized the divergence: “Gold’s surge is exposing the fiction that Bitcoin is digital gold. The bottom can drop out of Bitcoin at any time.” This view aligns with observers who note Bitcoin’s current correlation with tech and risk assets. At the same time, proponents argue that Bitcoin’s structural scarcity and evolving institutional infrastructure could alter its role over longer horizons.

Sources and data

Reporting is based on contemporary market data and commentary from sources including World Gold Council, major institutional trading desks, and public market reports. Price action and ETF flow observations are drawn from market summaries and public filings in the period around October 10. (All source names provided as plain text per editorial policy.)

Conclusion

The recent episode where gold climbed above $4,000 per ounce while Bitcoin fell underscores a short-term distinction between the two assets: gold acted as a traditional safe haven, and Bitcoin behaved like a risk-on instrument. COINOTAG recommends that investors differentiate allocations based on objective goals—defensive reserves versus growth exposure—and monitor official data (World Gold Council, ETF filings, exchange market data) for shifts in demand dynamics. For ongoing coverage and data-driven analysis, follow COINOTAG’s market updates.