Gold is going crazy, so why isn't "digital gold" Bitcoin a safe haven?

CoinDesk recently published an analytical article by Francisco Rodrigues, exploring a phenomenon that puzzles cryptocurrency supporters: Why hasn’t Bitcoin played the same safe-haven role as gold during times of market turmoil? Rodrigues points out in the article that, in theory, Bitcoin should perform well in times of uncertainty because it is an anti-censorship “sound money.” But in reality, the opposite happens—**when panic strikes the market, Bitcoin is often the first asset investors dump.** Looking at recent market performance, this divergence is especially apparent. Since January 18, when Trump first threatened to impose tariffs on NATO allies over Greenland issues, Bitcoin has dropped 6.6%, while gold has risen 8.6%, approaching a historic high of $5,000. Rodrigues believes that during uncertain economic times, Bitcoin acts more like an “ATM,” with investors quickly selling Bitcoin to raise cash. ## Bitcoin Becomes the Market’s “ATM” Why is Bitcoin sold off during a crisis? Rodrigues cites the views of Greg Cipolaro, Global Head of Research at New York Digital Investment Group (NYDIG), to explain this phenomenon. Cipolaro argues that Bitcoin’s very characteristics have become its “Achilles’ heel.” “In times of stress and uncertainty, the preference for liquidity dominates, and this dynamic hurts Bitcoin far more than gold,” Cipolaro wrote in his report. **Bitcoin’s 24/7 trading, deep liquidity, and instant settlement make it the easiest asset for investors to cash out quickly. In contrast, although gold is less liquid, holders tend to keep it rather than sell.** This creates an interesting paradox: Bitcoin’s advantages make it act more like an “ATM” in a crisis. Cipolaro further notes: “Although Bitcoin is liquid relative to its size, it remains more volatile and is reflexively sold during the deleveraging process.” Therefore, in risk-averse environments, regardless of its long-term narrative, Bitcoin is often used to raise cash, reduce Value at Risk (VAR), and lower portfolio risk, while gold continues to serve as the true reservoir of liquidity. ## Large-Holder Behavior Intensifies Divergence Beyond the asset’s characteristics, the behavior of large holders intensifies this divide. The author notes that central banks have been buying gold at record levels, creating strong structural demand for the gold market. This sustained institutional buying provides solid support for gold prices. In sharp contrast, according to NYDIG’s report, Bitcoin’s long-term holders have been consistently selling. On-chain data shows that “old coins” held for longer periods are continually flowing into exchanges, indicating steady selling pressure. Rodrigues calls this phenomenon “seller overhang,” which weakens Bitcoin’s price support. “The opposite dynamic is playing out in the gold market. Large holders, especially central banks, continue to accumulate the metal,” Cipolaro adds. This difference in institutional behavior reflects the different status and recognition that the two assets enjoy in the traditional financial system. ## Different Safe-Haven Scenarios, Different Choices So has Bitcoin lost its safe-haven value? The author believes the answer is not so simple. The key issue is how the market prices the current type of risk. **Rodrigues explains that the current market turmoil is seen as “episodic”—driven by tariff threats, policy uncertainty, and short-term shocks.** Gold has long been a hedge against such uncertainty, performing well during sudden loss of confidence, war risks, and fiat currency devaluation that does not involve systemic collapse. **In contrast, Bitcoin is better suited to hedging long-term concerns, such as large-scale fiat devaluation or sovereign debt crises.** “Bitcoin is better suited to hedging long-term monetary and geopolitical disorder and the slow erosion of trust that unfolds over years rather than weeks,” says Cipolaro. It’s like preparing different medicines for different diseases. If you’re worried about short-term market volatility and policy risk, gold is the better choice; but if you’re concerned about the long-term stability of the entire monetary system, Bitcoin may truly be the “insurance” you need. The author notes: “As long as the market sees current risks as dangerous but not fundamental, gold remains the preferred hedging tool.” Risk Warning and Disclaimer The market is risky; investment should be cautious. This article does not constitute personal investment advice, nor does it take into account individual users’ specific investment objectives, financial situations, or requirements. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Invest at your own risk.