Given the Trump administration's voice and support for the code, some investors believe Gold's days as a favorite hedge asset in the world is numbered.
André Dragosch, European research director at Bitwise Asset Management, suggests that the choice is not so simple. In a X Saturday post, he provided the rules of worry. Gold still works best as a protection against stock market losses, while Bitcoin is increasingly acting as a counterweight for bond market stress.
Gold: Equity hedge of choice
Inference begins with history. When stocks sell, investors often plunge into gold. Back up this. Gold's long-term correlation with the S&P 500 is approaching zero, and often drops negatively during market stress.
For example, in the 2022 Bear market, gold prices rose by around 5% even if the S&P 500 fell nearly 20%. That pattern shows why gold is still considered a classic “safe shelter.”
Bitcoin: Bond Market Counterweight
Bitcoin, by contrast, has often struggled during stock panic. In 2022, it collapsed more than 60% along with high-tech stocks. However, its relationship with the US Treasury Department was more interesting.
Several studies have pointed out that Bitcoin has a low or slightly negative correlation with government bonds. That is, when bond prices sink and yields rise – as we did in 2023 amid fears of US debt and deficits, Bitcoin can be better than gold.
Dragosch's Takeaway: Investors don't have to choose from each other. They play different roles. Gold is still a better hedge when wobbles and wobbles, but Bitcoin could support its portfolio when the bond market is under pressure from rising or financial worries.
How the 2025 rules will be retained
The division has been revealed this year. As of August 31st, gold had risen by more than 30% since the start of the year, according to World Gold Council data. That surge reflects new demand during the seizures of stock volatility related to tariffs, slowing growth and political risks.
Meanwhile, based on Coindesk data, Bitcoin won around 16.46% this year. This is a solid performance considering the US Treasury yield fell by around 7.33% over the 2010 year, according to MarketWatch data.
By comparison, the S&P 500 has increased by about 10% in 2025 per CNBC data.
The diverging performance highlights the heuristics of Dragosh. Gold benefited most from equity jitter, but Bitcoin has wobbled the bond market under the higher yields and heavy government borrowing weight.
Not just opinions: data supports it
This is not just Dragosh's personal view. A Bitwise research report earlier this year shows that gold remains a reliable hedge against the stock market slump, but Bitcoin tends to offer stronger returns during the recovery, with a lower correlation with the US. The report concluded that holding both assets can improve diversification and optimize risk-adjusted returns.
caveat
Still, the correlation is not static. Bitcoin's relationship with stocks was strengthened in 2025 thanks to a massive influx of spot ETFs that brought billions of dollars from institutional investors.
With a huge net inflow into spot Bitcoin ETFs, BTC trading becomes like a mainstream risk asset, reducing its “purity” as a bond hedge.
Short-term shocks can also be scrambled photos. Regulatory surprises, liquidity throttles, or macro impacts can move both gold and bitcoin in the same direction, limiting its usefulness as a hedge. In other words, that is exactly what Dragosch's rules of worry are. It is heuristic and not a guarantee.
Conclusion
Trump's pro-cryptic stance raises a provocative question: Is it time to abandon gold completely in favour of Bitcoin? Supported by years of data, Dragosch's answer is no. Gold still works best when inventory falls, but Bitcoin could provide shelter when bonds are under pressure. For investors, this lesson is about not throwing one of them into other assets, but recognizing that they hedge different risks, and using both may be a smarter play.
