Bitcoin price holds steady as investors flee gold. Have safe-haven roles finally reversed?

The tables have turned, and lately, Bitcoin has behaved as the world’s safe-haven asset.

Indeed, critics have spent years attacking Bitcoin for failing to serve as a store of value amid myriad geopolitical crises.

But during the latest military conflict in the Middle East, investment data paint a much different picture: Bitcoin exchange-traded funds are holding up while gold spot ETFs are bleeding out.

“Since the Iran strike, Bitcoin, surprisingly, has looked like a good safe haven. and gold hasn’t,” Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, told DL News.

In the last week, around $3.8 billion has exited the top two gold ETFs, GLD and IAU, while Bitcoin ETFs, on the other hand, have taken in around $2 billion, over the past few weeks.

Gold is worth around $4,500 today, while Bitcoin is worth $70,400 today.

Too soon to tell

Balchunas pushed back on the idea that Bitcoin and gold should move in opposite directions.

“They are more like zero correlated, not inversely,” he said on March 24. “They both perform similarly. Both are stores of value, just one is older and the other is younger.”

Balchunas’s framing challenges the common assumption that Bitcoin behaves like digital gold, tracking the yellow metal in lockstep with the $1.4 trillion cryptocurrency, or in its perfect opposite, like a levered tech stock.

Instead, the Bloomberg analyst argues that they’re both stores of value operating independently. Sometimes they rise together, sometimes they diverge, but they are not necessarily opposed.

To be sure, Balchunas noted that it’s too early to tell that the role between the cryptocurrency and the precious metal has actually reversed.

“You have to look long term about both of these and you will find that they’re both store values, but people like to make these judgments based on a couple of weeks,” he told DL News.

Meanwhile, the S&P 500 has lost around 2.5% over the last week, and crude oil has fallen around 8% after US President Donald Trump reported positive talks with Iranian leader over opening the Strait of Hormuz — a key trade channel that facilitates roughly 20% of the world’s oil demand.

Crypto market movers

• Bitcoin is up 0.2% over the past 24 hours, trading at $70,572.
• Ethereum rose 0.8% in the last day to $2,153.

What we’re reading

• Tether signs Big Four accounting firm after years of criticism over its reserves transparency — DL News
• Resolv’s $23m hack highlights DeFi risk management struggle — DL News
• BitGo and Susquehanna Launch Institutional OTC Access to Prediction Markets — Unchained
• Bittensor. So hot right now — Milk Road

Mathew Di Salvo is a news correspondent, and Pedro Solimano is a markets correspondent with DL News. Got a tip? Email them at mdisalvo@dlnews.com and psolimano@dlnews.com.