The price of gold has recently demonstrated a remarkable increase, resulting in new record highs. This development raises questions about gold's role in the current economic context and its potential impact on the crypto market, particularly on Bitcoin. In this article, we analyse the factors behind the rising gold price and the implications for crypto investors.

Factors Behind the Rising Gold Price

The current gold price is around $3,125 per troy ounce, which corresponds to approximately €2,885 per troy ounce. The price per kilogram is approaching $100,000. Several factors contribute to this rise:

Economic Uncertainty: Concerns about the economic situation in the United States and geopolitical tensions, such as the threat of trade wars, stimulate demand for gold as a "safe haven." Investors seek value-stable investments during times of unrest.
Interest Rate Policy: Expectations regarding the Federal Reserve's (Fed) interest rate policy can influence gold's attractiveness. Potential interest rate reductions could support the gold price.

Gold Versus Bitcoin: Comparison and Analysis

The performance of gold and Bitcoin currently shows an interesting contrast. While gold is rising, Bitcoin has lost value recently. This raises the question of whether Bitcoin, despite the comparison to "digital gold," fulfils the same role as traditional gold.

It is important to acknowledge that Bitcoin, as a relatively new asset class, has a different dynamic than gold. Bitcoin often has a higher correlation with risk assets, such as tech stocks, and reacts differently to economic uncertainty.

Implications for Crypto Investors

The developments in the gold market are relevant to crypto investors. They emphasise the importance of:

Diversification: Considering different asset classes in an investment portfolio.

Market Analysis: Understanding the factors that influence the prices of different assets.

Risk Management: Evaluating the risks and potential benefits of various investments.

The gold price continues to rise, with a recent record of $3,057 per troy ounce (the eighteenth this year) just twelve days ago. Many investors expect further increases, partly due to the potential impact of the announced import tariffs by the Trump administration on the demand for gold.


Disclaimer: This is not financial advice. Always consider conducting your own research and seeking professional advice.