Written by: Dominic Basulto Translated by: Vernacular Blockchain

Cryptocurrency investors have long called Bitcoin "digital gold". If that is the case, then Bitcoin, like gold, should be able to hedge market volatility and economic uncertainty experienced by investors at present.

But let's see what's going on now. Gold has just broken through $3,000, a record high and has risen 15% so far this year. By comparison, Bitcoin has dropped nearly 20% from its all-time high of $109,000 in January.

Gold seems to be rising, while Bitcoin – at least at the moment – ​​seems to be falling. So, which one is the better investment option now? The answer may not be as obvious as you think.

A key factor to remember is the correlation between Bitcoin and the stock market. For most of its history, Bitcoin has been completely unrelated to the stock market, which is why it is so attractive to many investors. In 2024, WisdomTree conducted a comprehensive study of Bitcoin and found that Bitcoin has little relevance to the stock market, except for some short periods since 2012.

In many ways, this irrelevance makes Bitcoin the ultimate portfolio diversification tool. It’s not just Bitcoin that doesn’t relate to the stock market – it doesn’t relate to all major asset classes. It seems unique, and Wall Street also agrees with Bitcoin as a potential tool to hedge economic uncertainty and market volatility.

But in 2025, something very strange is happening: Bitcoin is becoming more and more like tech stocks. This view is supported by increasing statistical evidence.

In March, Standard Chartered, a major British bank, looked closely at the correlation between Bitcoin and the stock market and found that the correlation between Bitcoin and Nasdaq is now 0.5, up to 0.8 earlier this year. Meanwhile, Bitcoin’s correlation with gold appears to have been lost, now at just 0.2, and even at zero earlier this year.

These numerical changes may seem small, but in the eyes of investorsBut it is of great significance. This suggests that Bitcoin may no longer be a safe haven asset. Of course, the correlation will change over time, but Bitcoin is now highly consistent with the trend of tech stocks. Simply put, buying Bitcoin now is like buying a tech stock with a lot of volatility. If tech stocks fall, Bitcoin will also fall; if tech stocks rise, Bitcoin will also rise.

Any saying that Bitcoin is digital gold now looks like a delusion. How could it be digital gold if Bitcoin is not even related to gold? If Bitcoin is a tool to hedge economic uncertainty, why is its price still falling?

It is understandable that many Bitcoin investors (like tech stock investors) have begun to be obsessed with the latest U.S. macroeconomic data. All this data—inflation reports, consumer confidence reports, gross product (GDP) reports—is crucial to understanding how Bitcoin will move next.

The potential impact of large-scale comprehensive tariffs remains unknown. If these tariffs push the U.S. economy into a recession, and prices are rising, things could get very bad. Ask ChatGPT, what happened when stagflation became the new economic buzzword in the 1970s.

According to traditional wisdom, if you think the economy will fall into a recession due to tariffs, you should buy gold; and if you think the economy will rebound strongly due to "US First" tariffs, you should buy Bitcoin.

Goldman Sachs predicts that gold prices may reach $3,300 by the end of 2025. That's 10% up from the current $3,000 price.

But guess what? Bitcoin can rise by 10% in a 24-hour trading period. This performance seems not difficult to achieve for Bitcoin with a triple-digit return history over the next nine months. So, although gold now looks obvious and brainless investment choice, and Bitcoin is becoming more and more like tech stocks, I still choose Bitcoin. Ultimately, I believe Bitcoin will outperform gold in 2025.