During the past 12 months, gold-backed stablecoins such as PAX Gold (PAXG 0.16%) and Tether Gold (XAUT 0.14%) have burst onto the scene. Combined, they now have a market cap of more than $5 billion.
Offering 1-to-1 exposure to the price of physical gold, these gold-backed stablecoins appear to be taking the title of digital gold away from Bitcoin (BTC 1.79%). But is it too soon to give up on Bitcoin as a store of value?
Bitcoin vs. gold
In September 2025, investment giant BlackRock (BLK 0.54%) released a fascinating report ("Bitcoin: A Unique Diversifier"). It detailed the performance of Bitcoin versus gold during six different economic, political, and geopolitical crises in the period from 2020 to 2025.
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The findings might surprise you, especially if your core belief is that gold is the best store of value during any prolonged crisis. What BlackRock found is that, while Bitcoin may underperform gold during the first 10 days of a crisis, over a longer 60-day period, Bitcoin almost always outperforms gold.
Take, for example, what happened when global tariffs were announced in April 2025. During the first 10 days, gold increased in value by 4%, while the value of Bitcoin was largely unchanged. During a 60-day period, however, Bitcoin soared by 23%, while gold only increased by 6%. Bitcoin turned out to be a better store of value, even though it wasn't obvious at the outset of the crisis.
Bitcoin and the current Middle East conflict
This same pattern appears to be repeating with the breakout of hostilities in the Middle East. Bitcoin is up nearly 20% since the start of the war on Feb. 28. By way of contrast, gold is down 2%.
CRYPTO: BTC
Key Data Points
In fact, Bitcoin has now rallied above the $80,000 price level and recently hit a 12-week high. Moreover, money continues to flow into the spot Bitcoin exchange-traded funds (ETFs). This suggests that investors aren't scared off by Bitcoin's volatile and erratic behavior. They seem to consider it a better place to park their money than gold.
Make no mistake about it: During the past two months, Bitcoin has significantly outperformed gold. Amid all the geopolitical turmoil in the Middle East, money is flowing into Bitcoin and not into gold.
Of course, gold is hardly a slouch when it comes to acting as a long-term store of value. For example, gold is up 149% during the past five years. That's impressive, given that Bitcoin is only up 42% over that time period.
But extend that time horizon to 10 years or more, and Bitcoin begins to look like a superior investment. For example, Bitcoin is up a head-spinning 131,960,000% since its launch in 2009. There's no way you're going to capture those same types of returns by investing in physical gold or gold-backed stablecoins.
Is Bitcoin still digital gold?
During the past few years, billionaire hedge fund managers have been making the case for Bitcoin as digital gold. There's no better place to put your money if you're concerned about macroeconomic weakness in the U.S. or geopolitical conflict abroad, they say.
Even Federal Reserve Chairman Jerome Powell has acknowledged that Bitcoin, due to the inherent scarcity provided by its limited lifetime supply, could become a modern, high-tech form of gold.
The problem with this narrative, of course, is what has transpired during the past seven months. After hitting an all-time high of more than $126,000 in October 2025, Bitcoin has nosedived in value. It's now sitting 35% below its all-time high. Amid global tariff whipsawing and broader geopolitical upheaval, Bitcoin seems to have lost its way.
Still, it's hard to argue with what's been happening in the financial markets since late February. Bitcoin is surging, while gold is not. Even if you're a Bitcoin skeptic, you have to be impressed. For now, I'm going with Bitcoin as a better store of value than gold or gold-backed stablecoins.
