Bitcoin Slips While Gold Breaks Record Above $4,000, What’s Next?

Bitcoin (BTC) and gold (XAU) have moved in opposite directions over the past 24 hours, as a stronger U.S. dollar weighs on cryptocurrency markets while fueling demand for the traditional safe-haven metal.

Bitcoin has fallen 1.2% to $122,400 on Wednesday, retreating from its recent all-time high above $126,000 earlier this week. The decline comes as the U.S. Dollar Index (DXY), which measures the dollar’s strength against a basket of major currencies, climbed to its highest level since August 5. A stronger dollar often pressures dollar-denominated assets, including Bitcoin and gold.

Gold Shines While Bitcoin Faces Downward Pressure

Analysts say BTC faces potential downside toward $118,000, as technical resistance near $126,000 continues to hold firm. The pullback follows a week of massive inflows into U.S.-listed spot Bitcoin ETFs, which attracted more than $3 billion in the week ending Friday, helping push BTC to record highs before its recent correction.

While Bitcoin’s momentum has cooled, gold prices are soaring. The precious metal has climbed past $4,000 per ounce for the first time ever, extending a rally driven by strong investor demand and ongoing geopolitical and economic uncertainty.

According to a report from ING, inflows into gold-backed exchange-traded funds (ETFs) have surged to their highest level since September 2022. “Investors are adding gold ETFs at a rapid pace,” ING analysts noted, adding that total holdings remain below their 2020 peak — leaving “room for further additions” that could drive prices even higher.

Tokenized Gold Also Gains Traction

Gold’s price has doubled over the past two years, supported by heavy central bank purchases as countries diversify away from the U.S. dollar. Heightened trade tensions under President Donald Trump, along with conflicts in the Middle East and Ukraine, have added to gold’s appeal as a safe-haven asset amid global uncertainty.

The rally has extended to blockchain-based gold assets. Gold-backed tokens, such as PAX Gold (PAXG), have climbed above $4,000, mirroring spot market prices. The combined market capitalization of all tokenized gold products has now surpassed $3 billion, reflecting rising investor interest in digital representations of tangible assets.