Bitcoin As “Digital Gold” Narrative At Risk: JPMorgan

JPMorgan said that Bitcoin’s status as “digital gold” is weakening as the crypto lags behind the surging price of gold, which hit a record $3,167 earlier today.

The gold price traded down a little more than 1% at $3,124 at 10:31 a.m. EST after paring earlier gains, while Bitcoin slumped almost 4% to $82,219 after US Donald Trump unleashed a barrage of trade tariffs against the rest of the world yesterday.

Gold’s outperformance is proof that investors still favor the commodity over BTC in times of macroeconomic uncertainty, said JPMorgan analysts led by Nikolaos Panigirtzoglou in an April 2 report.

Risk assets are tanking after hours as Trump’s tariffs are worse than expected. Dow futures are already down over 1,000, which is 2.5%. S&P futures are down 4%, and NASDAQ futures are down 4.5%. Bitcoin is only down 3.5%. Gold, however, the true safe haven, hit a new record high.

— Peter Schiff (@PeterSchiff) April 2, 2025

The strategy of buying assets like gold and Bitcoin to hedge against inflation, weakening fiat currencies and long-term debt is known as the debasement trade.

The analysts went on to predict that this trend will persist, adding that they “see gold continuing to rise as the major beneficiary of the debasement trade.”

Bitcoin’s volatility and correlation with equities also raises questions over its ”digital gold’ narrative,” they added.

Gold ETFs See Inflows While Bitcoin ETFs Record Outflows In February And March

The pattern of investors favoring gold over Bitcoin can also be seen in ETF (exchange-traded fund) flows, according to the JPMorgan analysts.

Spot Bitcoin ETFs have seen outflows over the past two months, which is in stark contrast to the continued inflows into gold ETFs, they said.

Meanwhile, Bitcoin futures have also turned negative since January, while gold futures have remained relatively flat. This, according to the analysts, suggests that demand for gold is coming from private investors and central banks rather than speculative traders.

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