The Bitcoin-Gold ratio has fallen to 34, its lowest level since November 2024, as gold demand surges amid escalating U.S.-China trade tensions. This marks a 15.4% decline from the mid-December peak of over 40.

BTC-Gold ratio looks south. (TradingView/CoinDesk)

Gold’s price per ounce has climbed nearly 10% year-to-date, reaching a record $2,877, while bitcoin struggles to gain upward momentum. The shift highlights investors’ preference for gold as a safe-haven asset in times of uncertainty.

Gold Demand Soars with U.S. Deliveries

Physical gold deliveries to the U.S. have surged, with investment banking giant JPMorgan set to ship $4 billion worth of bullion to New York this month. This uptick in demand is largely driven by metal tariffs, which have pushed Comex futures prices significantly above spot prices. Traders have been loading U.S.-bound planes with gold to capitalize on the premium.

China’s demand for gold has also increased due to the Spring Festival, adding further bullish momentum to the metal’s rally.

Bitcoin Struggles Amid ETF Arbitrage Activity

While gold enjoys a strong rally, bitcoin has faced resistance despite inflows into U.S.-listed spot Bitcoin ETFs. According to 10x Research, the $4 billion inflows since the latest inflation data release have largely been driven by non-directional arbitrage trades.

“The ETF buying could be offset by simultaneous spot or futures selling (unwinding of long positions), dampening any significant price impact,” noted Markus Thielen, founder of 10x Research.

Safe-Haven Play: Gold vs Bitcoin

The ongoing macroeconomic uncertainty, including the trade war and inflation concerns, has strengthened gold’s appeal over bitcoin. Historically, investors have turned to gold in times of economic instability, while bitcoin is still considered a risk asset by many institutional players.

With gold hitting record highs and physical demand increasing, bitcoin may struggle to break out until fresh catalysts emerge in the crypto market.