Bitcoin can replace gold? Here are the latest academic findings on crypto ‘digital gold’

Jakarta, Pintu News – In recent years, the debate on whether Bitcoin can replace gold as a store of value has been heated among investors and academics. The term “digital gold” for Bitcoin has become increasingly common, but scientific research has concluded that the two assets have different characteristics – both in terms of volatility, usefulness as a safe haven, and reaction to economic crises.

Bitcoin vs Gold: A Comparison of Properties and Value

Bitcoin (BTC) is often referred to as “digital gold” because it is rare, decentralized, and has a limited supply of 21 million coins. Unlike fiat currencies, Bitcoin’s minting cannot be regulated by central banks, making it immune to inflation and government intervention. In this sense, BTC is similar to gold, which has been a hedge against economic turmoil for centuries.

However, according to research by Baur et al. (2018), Bitcoin has not fully met the criteria as a safe haven like gold. Gold has proven to be able to maintain its value during financial crises, while Bitcoin prices tend to follow market sentiment and experience extreme fluctuations. Other research also confirms that Bitcoin’s volatility is much higher than gold, making it less ideal for risk-averse investors.

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Volatility and the Role of a Safe Haven

One of the biggest obstacles to Bitcoin (BTC) replacing gold is its extremely high volatility. Throughout 2025 alone, the price of Bitcoin moved from under $76,000 (Rp1,241,308,000) to over $111,000 (Rp1,803,963,000), a far cry from the consistent price stability of gold. Research by Klein et al. (2018) found that Bitcoin’s correlation to traditional assets is also volatile, making it less effective as a hedge for low-risk portfolios.

However, some recent studies such as Xu and Kinkyo (2023) show that Bitcoin is actually a more effective short-term hedge than gold during certain crises, such as during the COVID-19 pandemic and the Russia-Ukraine conflict. Although it has not been able to replace gold completely, the potential of Bitcoin’s new role as a portfolio diversifier is starting to be recognized by institutional circles.

Inflation and Hedging Function

Historically, gold has proven to be an effective hedge against inflation and currency depreciation. Research by Dyhrberg (2016) shows that Bitcoin is starting to display similar behavior, although it is still limited by its short track record and immature infrastructure. Another analysis by Bouri et al. (2020) confirms that Bitcoin’s ability to offset inflation is still inconsistent and is more influenced by speculator behavior and social media trends, rather than pure macroeconomic factors like gold.

Bitcoin Transformation with Institutional Adoption

As more financial institutions started to include Bitcoin in their portfolios, there was a change in BTC price behavior. Corbet et al. (2019) noted that during the media euphoria, Bitcoin’s correlation with traditional assets declined, but during the financial crisis, Bitcoin moved in line with the stock market, not against it like gold.

This change indicates that Bitcoin cannot yet replace the role of gold completely. To truly be considered a gold substitute, Bitcoin must be able to demonstrate value stability and resilience in the face of various crisis conditions in the future.

Conclusion

Based on academic studies until 2025, Bitcoin (BTC) still acts as a complement, not a substitute for gold, in crypto and cryptocurrency investment portfolios. While it offers features of scarcity and the potential for high returns, its volatility and short history mean it has yet to overtake gold as a trusted hedge asset. However, this may change as regulations, market infrastructure, and the global crypto ecosystem matures.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities are subject to high risk and volatility, always do your own research and use cold hard cash before investing. All activities of buying andselling Bitcoin and other crypto asset investments are the responsibility of the reader.

Reference:

• Andrew Urquhart/Decrypt. Professor Coin: Can Bitcoin Replace Gold? Accessed July 17, 2025.