Gold Vs. Bitcoin: We Now Know Which Is The Real Safe Haven

by Erica Kollmann Benzinga Staff Writer

Zinger Key Points

Gold prices surge to near two-month highs, with spot gold jumping over 1% and futures rising as much as 1.6%.
Bitcoin falls 1.3%, in-line with broad U.S. stock indices.
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Heightened geopolitical tensions have triggered a classic flight to traditional safe-haven assets following Israel's strike on Iran on Friday.

Gold prices surged to near two-month highs, with spot gold jumping over 1% and futures rising as much as 1.6% after news of the airstrikes broke. On the other hand, Bitcoin BTC/USD fell 1.3%, in-line with broad U.S. stock indices.

The Details: The S&P 500, as tracked by the SPDR S&P 500 ETF SPY, slid 0.58% and the Dow Jones Index fell 1.11% as investors weighed the growing risks in the Middle East.

GOLD: Gold typically rallies when other assets fall. In fact, gold marched toward record-highs, jumping more than 1% to above $3,420 on Friday. Shares of the SPDR Gold Trust GLD and iShares Gold Trust IAU were up 1.21% and 1.2%, respectively.

BTC: Bitcoin has been marketed as "digital gold" due to its fixed supply and decentralized nature. However, its safe-haven credentials are less established.

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Bitcoin often moves in tandem with risk assets like equities, especially during periods of market stress.The cryptocurrency's price is also influenced by leverage and speculation, increasing its volatility.

"The airstrikes sent oil spiking, which jolted inflation expectations and yanked rates higher, creating a chain reaction across risk assets," said Ben Kurland, CEO at crypto research platform DYOR, per CNBC.

"Crypto, in particular, got hit because it's highly sensitive to liquidity and macro volatility. When oil rips and yields rise, the appetite for leverage shrinks," Kurland added.

Alongside gold, other traditional safe havens such as the U.S. dollar and government bonds also saw increased interest, but gold's proven track record in crisis situations makes it a preferred choice for investors seeking protection against volatility and potential market shock.

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