Bitcoin Stuck in the Middle of Gold Momentum: Is This Temporary or a New Signal?

Bitcoin is currently stuck in an awkward position. While gold has surged over 80% amid global uncertainty, Bitcoin has actually fallen 13% over the past year. With the price at $88.12K, this digital asset has failed to prove itself as an effective inflation hedge, raising sharper questions: is support for Bitcoin still relevant in this changing market?

Not all crypto supporters are giving up. They offer a different explanation for why Bitcoin is stagnating while gold gains market enthusiasm. This interpretation is important for understanding the future direction of the cryptocurrency market.

Gold-Bitcoin Divergence: Not a Failure, but a Reallocation

Before moving further, let’s look at the basic facts. The theory states that inflation-hedging assets should strengthen when the value of money weakens. For gold and other precious metals, this formula has proven accurate. But for the “digital gold” (Bitcoin’s nickname), the results are the opposite.

According to Mark Connors, Chief Investment Officer at Risk Dimensions, what’s stuck isn’t Bitcoin itself, but how the market is absorbing Bitcoin. “This isn’t a demand issue,” says Connors. “It’s a supply distribution event.”

Connors’ logic is simple yet compelling: institutional ETF inflows are indeed very large, but they aren’t pushing prices higher. Instead, they are just absorbing the supply that early adopters have been selling for over a decade. In other words, we are witnessing a large-scale transfer of ownership, not a failure of fundamental interest.

Old Market Memory: Why Do Investors Choose Precious Metals?

There’s a psychological aspect often overlooked: investor “muscle memory.” During times of fear and uncertainty, institutions tend to flock to assets they know well. Currently, that asset is gold and silver—not Bitcoin.

Andre Dragosch from Bitwise explains: “In times of uncertainty, investors first turn to familiar assets. Right now, it seems gold and silver are the main choices.”

Jessy Gilger from Gannett Wealth Advisors adds an interesting perspective. He sees the current gold surge as a “temporary political disruption.” He believes institutions often lack the insight to accept genuine technological phase shifts. “Gold has a legacy, but Bitcoin has demonstrated technical stability at the protocol level for over fifteen years. Expect a reversion to the mean,” Gilger says.

High Beta vs Store of Value: Two Different Perspectives

The fundamental question driving Bitcoin’s current stagnation is: what is Bitcoin’s true role? Is it a long-term store of value or a high-beta instrument correlated with tech stocks?

Charlie Morris, Head of Investment at ByteTree, views this as a perception issue, not a fundamental one. “The problem lies in the real world, not the digital world. Bitcoin isn’t failing; it’s just retreating in line with internet stocks, which have always been highly correlated since their inception.”

Morris’ view of Bitcoin is very different from traditional inflation hedges. He sees Bitcoin as an asset for the digital world, while gold is a reserve for the real world. When the real world faces geopolitical pressures, gold naturally outperforms.

Delayed Rotation: How Long Do We Have to Wait?

Peter Lane, CEO of Jacobi Asset Management, remains optimistic but with a time note. “There’s a long-standing comfort in the mainstream market for precious metals that Bitcoin hasn’t yet achieved. I still believe we will eventually see a delayed rotation into BTC.”

This “delayed rotation” concept is gaining popularity among analysts. The basic idea is that after gold and other traditional hard assets experience very high inflation, capital will start rotating into assets with more attractive valuations—like Bitcoin.

Andre Dragosch goes further with technical analysis. Based on the Mayer multiple relative to gold, Bitcoin is at levels last seen in 2022 when FTX was still operating. “There is significant underpricing of Bitcoin relative to the macro environment in 2026, and the global money supply likely to reverse and strengthen in the coming months,” he says.

Need for a New Catalyst: Is Deflation Changing the Narrative?

Anthony Pompliano, Chairman & CEO of ProCap Financial, opens a more nuanced scenario. Over the past half-decade, Bitcoin has acted as an inflation hedge. But with the possibility of deflation on the horizon, Bitcoin needs another demand driver.

“Bitcoin needs to find other sources of demand to keep pushing this asset higher. I remain optimistic about Bitcoin’s future prospects, but I recognize that macro environments and market participants are evolving rapidly,” Pompliano states.

David Parkinson, CEO of Musquet, is even more assertive. To him, Bitcoin isn’t just a “hedge” against inflation—it’s a “permanent solution” to it. “The fixed supply of Bitcoin and the continuous network growth provide extraordinary returns compared to inflation and even gold over multi-year periods.”

Conclusion: Stuck Now, But What About Later?

Bitcoin is stuck for now—that’s an undeniable fact. The divergence with gold is clearly visible in current market data. But the explanation behind this stagnation determines whether it’s a long-term issue or just a transitional phase.

Most Bitcoin supporters agree on one point: the current stagnation is about redistribution of ownership, market perception of digital assets, and the strong “muscle memory” investors have toward gold. It’s not about technological failure or Bitcoin’s economic model.

The question is no longer “Will Bitcoin recover?” but “When will the market cycle shift back in favor of assets with more attractive valuations?” According to most experts, the answer depends on how global macro conditions develop in the coming months.