2025 BTC–Gold Ratio Slides When Gold Takes Over

The Bitcoin-gold ratio, which highlights the ounce of gold needed to buy one BTC, has returned to 20 ounces per BTC, down roughly 50% from 40 ounces in December 2024. Rather than falling into a decline in Bitcoin (BTC) demand, this sharp shift reflected exceptional macroeconomic management.

Main Receptors:

Between December 2024 and Q4 2025, the BTC-gold ratio dropped from 40 to 20 ounces per BTC.

Central banks bought 254 tonnes through October and global gold ETF holdings increased by 397 tonnes in H1 2025.

Bitcoin demand slowed in H2, with spot ETFs' AUM falling from $152 billion to $112 billion, with long-term holders selling more than 500,000 BTC.

Why gold dominates the price storage auction in 2025

Gold led the global price-storage auction in 2025, delivering a 63% year-to-date (YTD) gain and breaking above $4,000 an ounce in Q4. What makes this rally unique is that it takes place despite the seemingly endless financial constraints.

The increase comes at a time when US interest rates have remained unchanged for most of the year, with the Federal Reserve only making its first basis point cut in September. Historically, such an environment puts pressure on non-yielding assets, but with gold rising sharply, it signals a structural shift in demand.

Central banks have been an integral part of this movement. Global official sector purchases reached 254 tonnes in October, with the National Bank of Poland leading the charge with an increase of 83 tonnes. Similarly, Global Gold Exchange Fund (ETF) holdings expanded by 397 tonnes in H1 2025 to a record high of 3,932 tonnes in November.

This was a significant change in the 2023 outflow pattern. This is despite the fact that gold in developed markets averaged 1.8% in Q2, but gold still rose 23%, marking a clear departure from its inverse relationship with traditional commodities.

Elevated uncertainty has further strengthened gold's appeal. The VX (Volatility Index) averaged 18.2 in 2025, up from 14.3 in 2024, with geopolitical risk indices up 34% year over year. Gold's equity beta squeezed to negative 0.12, the lowest since 2008, confirming demand from both risk hedgers and long-term allocations.

Thus, amid tight financial conditions in the United States and delayed policy reforms, gold has functioned as an inflation hedge and broad portfolio insurance through 2025.

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Why is Bitcoin lagging on a relative basis to gold?

Bitcoin has delivered strong returns through 2025, reaching six figures and benefiting from spot BTC ETF demand. However, relative to gold, Bitcoin underperformed in the second half of the year as demand conditions weakened.

Spot Bitcoin ETFs have seen strong early momentum, with total assets under management (AUM) rising from $120 billion in January to $152 billion by July 2025. Since then, AUM has declined to about $112 billion over the next five months. This contrasted with consistent inflows into gold ETFs over the same period.

It also indicated on-chain data distribution. According to Glassnode, long-term holding (LTH) gains exceeded $1 billion per day during the seven-day average in July, one of the largest gains on record.

While the realized gains were adjusted in August, sales continued throughout the year. In October, long-term holders sold 300,000 BTC worth $33 billion, representing the strongest LTH distribution since December 2024. As a result, LTH supply decreased from 14.8 million BTC to 14.3 million BTC on July 18.

For most of 2025, higher real yields have raised the possibility of holding Bitcoin, while the correlation with stocks has remained relatively high. Gold, on the other hand, benefited from a safe haven and reserve-oriented demand. This difference in demand regimes explains the squeeze in the BTC-gold ratio, indicating a cyclical recurrence rather than a structural breakdown in Bitcoin's long-term thesis.

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