Gold has been surging forward, while Bitcoin has been stagnant. As a crypto analyst with 7 years of experience, I have seen the key signals that most people overlook.
At the end of last year, if someone had said that the best-performing asset in 2025 would be gold, we, the believers in cryptocurrency, would have scoffed. After all, Bitcoin's increase of over 1,000% in the past 5 years has made gold look pale in comparison.
However, this year the price of gold has surpassed $4,400, with an increase of over 70% within the year, even reaching a historical high of $4,482 per ounce. In contrast, Bitcoin has fallen more than 5% this year, and its correlation with gold has dropped to a historical low.
As a cryptanalyst, I must honestly tell you: gold and Bitcoin are telling a financial story about 'betrayal and loyalty', and the ending may surprise everyone.
01 The truth behind gold's surge is far more than 'hiding gold in troubled times'
On the surface, the rise in gold prices is attributed to geopolitical conflicts and weak U.S. inflation data. But the truth is far from that simple.
Central banks around the world are staging a 'silent rebellion'. The global central bank gold purchase volume is expected to remain close to 1,000 tons in 2025, a trend that has continued since 2022. This is not a short-term fluctuation but a structural change.
The proportion of gold reserves held by developed countries versus developing countries reveals everything: the U.S. gold reserves account for 77.85% of asset reserves, while China's proportion is only 6.7%. Emerging markets are frantically 'catching up'.
What is even more surprising is that the open contracts for gold futures on the New York Mercantile Exchange far exceed the deliverable physical gold supply, with delivery times extended from days to weeks. This is a structural short squeeze on physical gold, and most retail investors are still in the dark.
The gold market is experiencing a perfect storm: the forces of de-dollarization demand, physical shortages, and the rush for gold by central banks are resonating together.
02 Why is Bitcoin temporarily malfunctioning? 'Digital gold' is facing an identity crisis.
Bitcoin is hailed as 'digital gold', but this year it has fallen over 25% compared to gold. Why is 'digital gold' temporarily malfunctioning?
Bitcoin is falling into an identity crisis. The data doesn't lie: Bitcoin's correlation with NASDAQ is as high as 0.5, while its correlation with gold is a mere 0.2. Bitcoin behaves less like 'digital gold' and more like 'digital Tesla'.
The approval of the Bitcoin ETF is a double-edged sword. On one hand, it marks Bitcoin's mainstream recognition; on the other hand, Wall Street giants have become the largest buyers in the market, and Bitcoin's fluctuations are starting to depend on the Federal Reserve and Trump.
Bitcoin's initial charm lies in its spirit of rebellion, not relying on any government. But once it is incorporated into the dollar system, it becomes difficult to resist this system.
U.S. miners control about 38% of Bitcoin's hash rate, and U.S. entities control about 15% of the total supply. This high level of binding with the U.S. makes other countries' central banks hesitant to consider purchasing Bitcoin.
03 The overlooked key signal: Bitcoin is accumulating strength
Despite Bitcoin's poor performance at the moment, I have discovered a key signal overlooked by 90% of investors.
Since the launch of the Bitcoin ETF in January 2024, ETFs and companies have cumulatively bought 1.39 million Bitcoins, while the new supply of Bitcoin in the same period is less than a quarter of this scale. This significant gap between demand and supply has not yet fully reflected in the price.
Gold's present signifies Bitcoin's future. Central banks have been buying large amounts of gold since 2022, but gold prices will only see a parabolic rise in 2025. Why? Because initially, price-sensitive investors sell at highs, and only after this selling pressure is exhausted does the price skyrocket.
Bitcoin is currently in a similar phase: the continuous buying by ETFs and companies is gradually absorbing the liquidity supply in the market, while short-term traders are taking the opportunity to realize profits.
Once this selling pressure is exhausted, Bitcoin will welcome its own 'golden moment'.
04 Trading strategy: seeking balance in two worlds
In the face of the current market, my strategy is: 'Gold in the left hand, Bitcoin in the right hand', seeking balance in both worlds.
Specifically, I am long on both Bitcoin and gold. Gold is the safe haven for now, while Bitcoin is the bet for the future.
In terms of asset allocation, the proportion of gold in household financial assets should not exceed 15%. For Bitcoin, I adopt a dollar-cost averaging strategy to avoid a one-time heavy investment.
In terms of product selection, I prefer a combination of physical gold-backed tokens and Bitcoin spot ETFs. The trading volume of gold-backed tokens on decentralized exchanges has surged by 320% year-on-year, indicating that the market's demand for digital gold allocation is on the rise.
What needs to be watched is that the speculative atmosphere in the market is nearing a dangerous zone. The daily MACD for gold prices has shown a top divergence signal, and a short-term correction of 20%-30% may occur. This could actually be a good opportunity for long-term positioning.
At dusk, Wall Street traders are closely watching whether gold prices can break through the $4,500 barrier. Meanwhile, in Shanghai's Lujiazui, a post-90s fund manager quietly shifts 20% of his investment portfolio into Bitcoin futures, believing that Bitcoin's 'golden moment' is not far away.
This world is splitting into two parallel universes: one is the traditional financial system where central banks are wildly buying gold, and the other is a decentralized future built on algorithms. Smart people won't choose one over the other; instead, they will bet on both universes simultaneously.
Dear readers, how are you positioning yourselves? Gold or Bitcoin? Feel free to share your views in the comments and give a thumbs up. In the next issue, I will reveal how to capture a tenfold investment opportunity from the rotation between gold and Bitcoin over three years.
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