Bitcoin has slipped to its lowest level since last year’s global tariff shock, raising fresh doubts over its long-held narrative as “digital gold”. The sharp decline comes at a time when traditional safe-haven assets such as gold and silver have surged amid heightened geopolitical tensions and trade uncertainty.
According to media reports, Bitcoin fell sharply over the weekend, briefly dropping below US$77,000 before stabilising near US$78,000. This puts the cryptocurrency down by more than 10% so far this year, contrasting starkly with the strong rally seen in precious metals.
Gold prices recently touched record highs as investors sought shelter from escalating geopolitical risks, including renewed tariff threats and rising global tensions. While bullion has since seen some profit-taking, it remains significantly higher year to date, reinforcing its status as a defensive asset during periods of market stress.
Bitcoin, however, has failed to mirror this behaviour. Despite years of being promoted as a hedge against economic uncertainty, the latest price action suggests investors continue to treat cryptocurrencies as risk assets rather than safe havens.
Market analysts have pointed out that Bitcoin lacks a universally accepted valuation framework. Unlike gold, which benefits from centuries of use as a store of value, Bitcoin’s price drivers remain heavily influenced by sentiment, liquidity, and macroeconomic expectations.
The recent decline also follows a strong rally late last year, when optimism around a more crypto-friendly policy environment in the US helped push Bitcoin to record highs. Since then, fading enthusiasm and growing political associations have weighed on investor confidence. Some market participants believe Bitcoin’s perceived alignment with US political developments has contributed to volatility amid global uncertainty.
Meanwhile, other major cryptocurrencies such as Ethereum and Solana have also experienced significant pullbacks, reinforcing the broader risk-off tone across digital assets.
Industry observers note a shift in investor interest away from Bitcoin toward alternative areas of the digital asset ecosystem, including prediction markets, derivatives platforms, and crypto-linked financial products. This diversification of capital has diluted attention from Bitcoin’s original “digital gold” thesis.
For Australian investors, the latest move serves as a reminder that while cryptocurrencies can offer growth potential, they remain highly volatile and sensitive to global risk sentiment. In contrast, traditional defensive assets continue to play a stabilising role during periods of uncertainty.
As markets navigate an increasingly complex global backdrop, the debate over Bitcoin’s true identity — a speculative asset or a store of value — remains far from settled.
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