Crypto vs. gold: Which is the best safe haven in a fractured stock market?

As the stock market stumbles into the year’s final stretch and investors brace for another dose of interest rate uncertainty, a big question is resurfacing: When markets fracture, what’s the optimal safe haven?

Two high-profile alternative investment options come to mind. 

Gold has reclaimed its shine as prices flirt with $4,000 an ounce, while Bitcoin, fresh off a run back above $100,000, is testing whether digital scarcity can outshine the world’s oldest hedge. Both have moved in opposite directions at times, and they're telling a deeper story about where anxious investors are parking their portfolio cash when the traditional stock market playbook stops working.

Industry data confirms growing agitation on Wall Street. A new study from Charles Schwab notes that while most traders remain bullish on stocks, 67% also say the market is overvalued (up 10 points from three months ago). Another 57% say that stagflation, the dreaded combination of slow economic growth and persistent inflation, is “somewhat or very likely in the next 18 months,” the study reported.

Here's what investors should know.

Weighing the value of gold versus Bitcoin

Ongoing angst about the economy and the stock market is giving both the gold and crypto markets a shot of adrenaline, as the benchmark S&P 500 index fell about 2% over the course of five days.

Here’s where gold and Bitcoin stand right now.

Gold prices

As of late this week, gold prices stood at about $4,000 per troy ounce. Gold had recently crested above the $4,000 mark before retreating moderately as commodity traders weighed the impact of the U.S. dollar, which is tightly tied to gold prices, ongoing inflation concerns, and the Federal Reserve's response. Typically, gold acts as a hedge or “insurance” in times of uncertainty.

Bitcoin

The highest-profile global cryptocurrency, Bitcoin was trading at about $102,000 late this week after losing some ground in recent days. The crypto market is in a holding pattern as investors weigh institutional ETF flows and as some macroeconomic data, such as the monthly jobs report, is in a blackout because of the record-long government shutdown. Investment experts deem Bitcoin a more speculative, higher-volatility “growth-oriented” risk asset, and you may allocate differently depending on your risk tolerance.

“Both gold and Bitcoin continue to gather momentum but for very different reasons,” said Eric Roach, partner at Summit Metals in Park City, Utah. “Gold tends to trade in a non-correlated fashion to the market, where Bitcoin remains much more correlated with the Nasdaq (QQQ). Although Bitcoin has a limited supply, much like safe-haven assets, it trades and acts much more like a technology stock.”

Which is the real differentiator?

IShares Bitcoin Trust (IBIT), a leading Bitcoin ETF, is 37% correlated to the Nasdaq-100 (or QQQ) and the S&P 500. Gold stands at 4%, which means gold is the preferred stock market alternative play. Additionally, the iShares Silver Trust (SLV) ETF is correlated at 20% with the stock market and 74% with gold, providing a slightly more balanced portfolio play than pure gold.

“As conditions change relative to a risk versus risk-on trade, the proportion of investment in Bitcoin versus gold will increase,” Roach said. “Likewise, should protecting against risk become your primary driver, then gold stands alone with its highly negative correlation to the stock market.”

For investors seeking an ETF strategy for gold and Bitcoin, there are two main drivers to consider: management costs and liquidity. “For gold investors, the standby GLD ETF works very well, and for Bitcoin, the IBIT ETF commands the lion’s share of the liquidity,” Roach noted.

Who’s performing better?

The data shows safe-haven assets are clearly back in focus as macro uncertainty and geopolitical tensions rise. Still, the momentum has split sharply between gold and crypto in recent weeks.

“Gold ETFs saw one of their strongest months in years, with over $17 billion in inflows in September and another $8.7 billion added in late October,” said Nicholas Roberts-Huntley, CEO at Blueprint Finance. “That’s a clear signal that institutional money is prioritizing stability and tangible hedges.”

Meanwhile, Bitcoin ETFs have cooled, posting $200 million in net outflows on October 31 as traders took profits after a strong summer run. “These pullbacks are often temporary consolidations, not reversals,”  Roberts-Huntley noted. “Historically, BTC has rallied strongly in the months following peak gold inflows, so it wouldn’t be surprising to see capital rotate back into digital assets heading into year-end."

Is the preference for gold solid over the long term?

So what are the main gold and crypto performance metrics, and what are ETF inflows telling the markets right now? In a word, it’s all about emotion.

“We’re seeing a clear short-term tilt toward gold over Bitcoin as investors de-risk and look for immediate safety, but it’s too early to call it a lasting rotation back to equities,” Roberts-Huntley said.  

ETF flows, on the other hand, tell a more nuanced story.

“Gold is benefiting from fear, while Bitcoin is digesting a period of profit-taking and positioning for the next macro environment, particularly with the Fed now in an easing cycle,” Roberts-Huntley added. “Historically, when gold inflows surge to record highs, Bitcoin tends to lag briefly before outperforming within the next 6–12 months. The divergence today isn’t a rejection of crypto’s safe-haven thesis, but rather, it’s a reflection of risk sentiment catching up with monetary reality."

The call on Bitcoin versus gold is complicated and unique for each investor

There’s no one-size-fits-all approach to choosing between Bitcoin and gold as a defensive portfolio hedge, as the choice depends heavily on individual risk tolerance, investment horizon, and comfort with volatility.

“Gold has historically exhibited lower volatility and is often seen as a long-term stabilizer in portfolios,” said Shane Molidor, CEO at Forgd, a token advisory and optimization platform. “Bitcoin has delivered higher historical returns but with meaningfully larger drawdowns.” 

Some investors who are open to emerging asset classes and longer time horizons may consider Bitcoin exposure. “In contrast, others, who are more focused on capital preservation, tend to gravitate toward gold,” Molidor added.