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Bitcoin has outperformed gold significantly over the past two weeks as US-China trade tensions ease, pushing the BTC-to-Gold ratio through a key technical barrier that points to more gains ahead. The top cryptocurrency jumped 19% to $104,000 while gold dropped 8% to $3,211 during the same period.
A bullish breakout in the Bitcoin-to-Gold ratio recently broke through what’s called an inverse head-and-shoulders pattern. This formation typically shows when a downward trend is about to reverse and turn upward.
“The breakout happened last week after the ratio cleared the resistance level at 32.00,” explains Omkar Godbole from CoinDesk. Based on this pattern, analysts predict the ratio could rise to at least 35.00, suggesting Bitcoin will continue to strengthen compared to gold.
Source: TradingView/CoinDesk
This shift comes as the United States and China announced major tariff cuts in a joint statement from Geneva. China will reduce tariffs on US goods from 125% to 10%, while the US will lower tariffs on Chinese imports from 145% to 30%. Both changes will last for 90 days.
This trade breakthrough has triggered a move away from safe-haven assets toward riskier investments. Gold, traditionally seen as protection during uncertain times, reached above $3,500 on April 22 before falling as investor confidence improved.
Mena Theodorou, co-founder of crypto exchange Coinstash, told CoinDesk: “The tariff reduction could see a broader return to risk-on positioning, with crypto and equities both likely to benefit from renewed investor confidence and global capital flows.”
The improving trade picture goes beyond just US-China relations. Theodorou pointed out that the US has also completed trade deals with the UK, while Russia and Ukraine are scheduled to discuss a potential ceasefire later this week.
Big investors appear to be responding to these positive developments. According to CoinShares data, about $5.5 billion has flowed into digital asset investment funds over the past three weeks. This includes $1.8 billion for Bitcoin products in just the week ending May 3.
Geoff Kendrick, global head of digital asset research at Standard Chartered Bank, believes this trend could speed up. “We expect a strategic asset reallocation away from U.S. assets to trigger the next sharp upswing in bitcoin,” Kendrick said. He predicts Bitcoin could reach around $120,000 by the second quarter of 2025.
While Bitcoin has beaten gold recently, some market watchers maintain that gold offers better long-term value. Experts argue that while cryptocurrency prices may continue rising short term, gold provides essential “monetary insurance” against economic problems.
