While the original Bitcoin whitepaper mostly focused on the crypto network as a peer-to-peer digital cash system for decentralized payments, the narrative around the world’s largest and most valuable crypto asset has evolved into more of a store of value rather than a medium of exchange over the past decade. This is where the “digital gold” nickname originated, as some believe that bitcoin can act as an apolitical base money for the digital age with a monetary policy that was “set in stone” when the network first launched all the way back in 2009.
As Larry Fink, the CEO of financial titan BlackRock, explained just last month, “Bitcoin is an asset of fear . . . The long-term fundamental reason you own [bitcoin] is because of debasement.”
While some view this digital gold narrative as a pivot from Bitcoin’s original design, the reality is that the system’s creator, Satoshi Nakamoto, was concerned with removing the trust required in central banks to not debase the currency in some of his earliest writings.
This may all sound great in theory, but the reality is that bitcoin has routinely been unable to act like its analog sibling in times of global economic turmoil. For example, the bitcoin price suffered one of the worst crashes in its history when COVID-19 was officially declared a pandemic in early March 2020. Over the past week, bitcoin has also dropped roughly 10% amid increasing tensions between the United States and Europe over control of Greenland and the selloff in the Japanese bond market.
Last October, there was also a massive crash in the greater crypto market, including $16 billion in liquidations on leveraged positions, amid increased trade tensions between the U.S. and China. Of course, many of the liquidated positions were in crypto assets that are much more speculative and less credible than bitcoin.
Meanwhile, gold is up roughly 5% over the past week. In fact, gold massively outperformed bitcoin in 2025, despite the precious metal supposedly being the less speculative and volatile asset of the two. While bitcoin has seen increased institutional adoption from the likes of Ivy League university endowments, nation states, and the largest asset manager in the world, the reality is that central banks, most notably China, still prefer real gold over its digital alternative.
That said, the functional utility of bitcoin as something like digital gold still exists, as was shown by the recent flight from crypto exchanges in Iran to the base Bitcoin network. In addition to the local populations, there has been extensive reporting on nation-states like Iran and Venezuela using crypto to avoid economic sanctions imposed by the United States. While much of this activity is being usurped by stablecoins, these dollar-pegged tokens can also be easily frozen by their centralized issuers.
Of course, the current inability of bitcoin to act as a safe-haven asset does not mean it is destined to fail to achieve its long-term goals. After bitcoin crashed at the beginning of the COVID-19 pandemic, it went on to enjoy a 4,000% price rise to the new all-time high of around $125,000 hit last year. The price has since settled back down in the $90,000 area, and it’s unclear if the usual four-year cycles from the past will continue.
The fact that it still moves like a tech stock in times of increased economic tension is a sign that it is still early days for bitcoin, despite its market cap now being measured in the trillions of dollars. However, it will eventually need to start acting more like the digital gold it’s touted to be if it wants to stand the test of time and become the basis of a new, digital monetary standard for the 21st century.