The DeFi Report Why is Bitcoin Underperforming Gold?
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Jan 28, 2026 They compare Bitcoin and gold performance and analyze the BTC/gold ratio. They explore why gold is rallying, including China and central bank demand. They discuss why Bitcoin still acts like a risk-on asset and where the ratio could bottom. They highlight market signals to watch like miner stress, ETF flows, and onchain metrics before deploying capital.
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Perception Distorted By Precious Metals Rally
- Bitcoin is down ~30% post-peak but that looks mild versus prior cycles when it fell much more.
- The market feels worse because gold and silver are massively outperforming, creating investor envy.
BTC/Gold Ratio Still Has Room To Fall
- The BTC/Gold ratio peaked near 40 this cycle and has fallen to ~17, a ~53% decline from peak.
- Prior cycle troughs fell ~76–83%, so current levels are not yet as low as past bottoms.
China Is Driving The Gold Supercycle
- Gold behaves as a global risk-off asset that rallies on geopolitical and macro uncertainty.
- China appears to be an outsized buyer, linking PBOC liquidity and citizen demand to gold's strength.