Produced in partnership with Binance
One of the more unsettling factors about this year – amid a smorgasbord of unsettling things – has been which “Trump trade” to pick. Buy the dollar, the S&P 500, the JSE, the rand, gold or bitcoin?
The winner (so far) is gold, which, as the Financial Times wrote last week, has become the best-performing Trump trade, as fears of a trade war and a potential hit to global growth “fuel demand for the haven metal … while other popular Trump trades such as bets on a stronger dollar, higher Treasury yields or bitcoin have backfired”.
It was bitcoin that soared in the wake of Donald Trump’s re-election, scaling more than $106,490 on December 17, partly on expectations that the crypto-friendly US president would usher in a new age of deregulation and animal spirits. But the two have diverged quite materially in 2025: bitcoin is down about 5.5% whereas the price of gold has rallied by about 11%.
But isn’t bitcoin just a digital gold? Sadly, no.
All Weather Capital portfolio manager Prince Mopai says you can’t really compare the two because the “fundamental drivers” are “not similar”.
Unfair to compare
EasyCrypto head Earle Loxton agrees. “The ‘bitcoin as digital gold’ idea is a common starting point, but it’s a bit of an oversimplification. So far in 2025 we’ve seen bitcoin and gold diverge because they’re driven by different forces, even if they share some traits, like scarcity,” he says.
For Loxton, “bitcoin’s volatility ties more to market sentiment and tech-driven momentum than gold’s slower, macro-economic dance. I’d say that’s why they’re not moving in lockstep this year – gold’s the tortoise, bitcoin’s the hare.”
One particular issue roiling crypto markets recently is the $1.5bn theft of crypto tokens from Bybit, a digital asset exchange that was hacked last week.
For RECM chair Piet Viljoen, the key difference is that gold’s been around for aeons and bitcoin, or crypto, has been around for decades. That plays into what’s known as the “Lindy effect”: where the longer something has been around the more likely it will be around.
Crypto still has to prove itself – through up and down cycles, says Viljoen.
“I think it’s unfair to compare it to gold. The price of crypto contains a massive speculative element. So, though the fundamentals are sound – if one just thinks about bitcoin, there’s a limited supply so there’s only so much of them – over time the price against something with an unlimited supply like dollars or rands, should go up.”
But, he warns, “in the short term you can have speculative froth coming into the price or going out, which makes it a lot more volatile than gold or other currencies”.
Viljoen’s latest letter to investors also contains a few fascinating snippets about how hard assets can retain their value over the years – be they gold (or potentially, one day, bitcoin), versus so-called fiat currencies, like the dollar, where trust in the system that prints those dollars, say, is paramount.
“In April 2024,” he writes, “Jamie Kennedy, director of digital content for Golf Digest, posted a fascinating analysis of Tiger Woods’ historic 2000 season on the PGA Tour. Universally considered the greatest individual performance in golf history, Woods earned $10.7m in prize money for his accomplishments, an incredible sum for that period.
“Kennedy’s workings showed those same results would have won him $92.3m in 2024, or around nine times more. The average price of gold in 2000 was approximately $270 per ounce. In 2024, it was closer to $2,400, about nine times higher. Coincidence?”
For all your bitcoin pricing needs, we have conveniently added the Binance pricing widget here for you.
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