Bitcoin Acts Like Cash in Market Turmoil While Gold Reasserts Its Safe-Haven Role

Bitcoin is often promoted as sound, censorship-resistant money designed to thrive during periods of global uncertainty. Yet recent market behavior tells a different story. As geopolitical tensions intensified over the past week, bitcoin became one of the first assets investors sold, while gold surged to fresh record highs.

Market volatility spiked after U.S. President Donald Trump threatened tariffs against NATO allies over Greenland and as speculation grew about potential military activity in the Arctic. Instead of benefiting from the uncertainty, bitcoin declined. Since Jan. 18, when the tariff threats first emerged, bitcoin has fallen about 6.6%, while gold has climbed roughly 8.6%, pushing close to the $5,000 level.

The divergence highlights how bitcoin and gold function differently within investment portfolios during risk-off environments. Bitcoin trades 24/7, settles instantly, and offers deep liquidity, making it easy to sell when investors need quick access to cash. Gold, on the other hand, is less liquid in the short term and is typically held rather than sold during periods of stress. This dynamic has led analysts to describe bitcoin as behaving more like an “ATM” in moments of panic rather than as “digital gold.”

According to NYDIG’s Global Head of Research Greg Cipolaro, liquidity preference dominates during periods of uncertainty. Bitcoin’s higher volatility and widespread use as a leveraged asset mean it is often sold to reduce risk, unwind leverage, and manage portfolio volatility, even if its long-term narrative remains intact. Gold, by contrast, continues to act as a true safe-haven and liquidity sink.

Structural factors reinforce this gap. Central banks are accumulating gold at record levels, creating persistent demand. Meanwhile, on-chain data suggests long-term bitcoin holders are moving older coins to exchanges, signaling ongoing selling pressure that weighs on prices.

The difference also reflects how investors perceive current risks. Today’s turbulence is viewed as episodic, driven by tariffs, policy shocks, and geopolitical threats rather than systemic collapse. Gold excels as a hedge against immediate confidence shocks and war risk. Bitcoin, however, may be better suited for longer-term concerns such as fiat debasement, sovereign debt crises, and slow-moving erosion of trust in financial systems.