Bitcoin and gold represent two fundamentally different approaches to storing value outside the traditional financial system. Gold has served as humanity's primary store of value for over 5,000 years, prized for its scarcity, durability, and universal recognition. Bitcoin, launched in 2009, offers a digital alternative with mathematically enforced scarcity and the ability to transfer value globally without intermediaries.
The comparison between these assets has intensified as institutional investors increasingly view Bitcoin as "digital gold." Both assets share key characteristics: limited supply (21 million BTC cap vs. approximately 2% annual gold mining increase), no counterparty risk when held directly, and independence from government monetary policy. However, they differ dramatically in volatility, liquidity hours, and regulatory treatment.
For portfolio construction, the correlation between Bitcoin and gold matters significantly. During risk-off periods, gold has historically served as a safe haven, while Bitcoin's behavior has been less predictable—sometimes correlating with risk assets like tech stocks, other times moving independently. Understanding this relationship helps investors determine whether holding both provides genuine diversification or redundant exposure.
Key factors to monitor include: central bank gold purchases (which have accelerated since 2022), Bitcoin ETF flows following the 2024 spot ETF approvals, real interest rates (which inversely affect gold's opportunity cost), and Bitcoin's halving cycles (the next occurring in 2028).
Analysis period: 2024-12-30 to 2025-12-27
Cite This Comparison
"BTC vs GLD: Performance Comparison." Gale Finance, December 29, 2025. https://gale.finance/compare/btc-vs-gld Free to use with attribution. Please link back to this page or gale.finance.
Relative Performance (Normalized to 100)
Normalized to 100 at start date for comparison
Key Takeaways
- Raw returns: GLD outperformed with 73.2% total return vs -6.9% for BTC.
- Risk-adjusted (Sharpe): GLD had better risk-adjusted returns with a Sharpe ratio of 2.76 vs -0.06 for BTC.
- Volatility: GLD was less volatile at 19.4% annualized vs 42.1% for BTC.
- Max drawdown: GLD had a shallower max drawdown of -10.1% vs -32.1% for BTC.
Correlation Analysis
BTC and GLD are weakly negatively correlated over the past 6 months. With a negative correlation of -0.08, these assets tend to move in opposite directions, potentially offering strong diversification benefits.
| Metric | Metric | Value |
|---|---|---|
| Current (30-day) | 0.49 | |
| Average (full period) | -0.08 | |
| Minimum | -0.48 | |
| Maximum | 0.49 |
Correlation measures how closely two assets move together. Values near +1 indicate strong co-movement, near 0 indicates independence, and negative values indicate inverse movement.
Investment Comparison
If you invested $10,000 in each asset on December 30, 2024:
Difference: $8,005.6 (GLD ahead)
Risk Analysis
BTC experienced its maximum drawdown of -32.1% from 2025-10-07 to 2025-11-23. It has not yet recovered to its previous peak.
GLD experienced its maximum drawdown of -10.1% from 2025-10-20 to 2025-11-04. It took 48 days to recover.
Smaller drawdowns and faster recoveries indicate lower downside risk and greater resilience during market stress.
Sharpe Ratio
The Sharpe ratio measures return per unit of risk (volatility). A higher Sharpe indicates better risk-adjusted performance. GLD delivered -46.0x more return per unit of risk than BTC.
A Sharpe above 1.0 is generally considered good, above 2.0 is excellent. Negative Sharpe means the asset underperformed the risk-free rate.
Sortino Ratio
The Sortino ratio measures return per unit of downside risk. Unlike Sharpe, it only penalizes negative volatility. GLD had better downside-adjusted returns.
A higher Sortino is better. It's particularly useful for assets with asymmetric volatility (big gains, smaller losses). Downside volatility: BTC 29% vs GLD 14.1%.
Understanding Volatility
BTC's annualized volatility of 42.1% means it typically moves ±2.2% on any given day.
GLD's annualized volatility of 19.4% means it typically moves ±1.22% on any given day.
For comparison, the S&P 500 typically has 15-18% annualized volatility, translating to roughly ±1% daily moves. Higher volatility means larger potential gains but also larger potential losses.
Performance Over Time
| Metric | BTC | GLD |
|---|---|---|
| 30 Days | -0.1% | 8.8% |
| 90 Days | -20.5% | 20.2% |
| 180 Days | -18.7% | 38.4% |
| 1 Year | N/A | N/A |
Shorter time frames can show different leaders as market conditions change. Consider your investment horizon when comparing performance.
Full Comparison
| Metric | BTC | GLD |
|---|---|---|
| Total Return | -6.9% | 73.2% |
| Annualized Volatility | 42.1% | 19.4% |
| Sharpe Ratio | -0.06 | 2.76 |
| Sortino Ratio | -0.09 | 3.80 |
| Max Drawdown | -32.1% | -10.1% |
| Avg Correlation to S&P 500 | 0.03 | -0.07 |