Content Source: ABlockTalk Blog

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In August 2025, Bitcoin's market capitalization reached $2.457 trillion, successfully surpassing Google's parent company Alphabet to become the fifth-largest asset globally by market value. This milestone event has sparked widespread discussion: Can Bitcoin surpass gold in the future and become the preferred asset for global value storage? Gold, as a traditional safe-haven asset, has a market capitalization of $23.22 trillion, more than ten times that of Bitcoin. For Bitcoin to exceed gold in market value, its price would need to soar to $1,166,511, facing numerous challenges and opportunities. This article will delve into this topic from various perspectives, including the characteristics of Bitcoin and gold, market performance, institutional fund flows, scarcity, and future potential.

Bitcoin vs. Gold: A Comparison of Characteristics

As value storage assets, Bitcoin and gold each possess unique characteristics. Bitcoin, as a decentralized digital currency, has a strict supply cap of 21 million coins. As of August 2025, approximately 19.7 million coins have been mined, with the remaining portion expected to be fully mined by 2140. Its annual inflation rate has dropped to 0.83%, and through the "halving mechanism" that occurs every four years, Bitcoin's scarcity is further enhanced. Currently, Bitcoin's stock-to-flow ratio is 112, higher than gold's 62, indicating stronger scarcity.

In contrast, gold's annual new production is about 3,000 tons, with an annual supply growth rate of 1.72%. Although gold's supply is limited by geological and mining technology constraints, breakthroughs in deep-sea mining or space mining technology in the future may increase its supply. Additionally, gold has a 5,000-year history as a currency and widespread industrial and jewelry demand, which gives it unique practical value and market stability.

Market Performance: Volatility and Returns

Bitcoin and gold exhibit significant differences in market performance. Over the past five years, Bitcoin's price has surged by 892%, far exceeding gold's 72%. However, from the beginning of 2025 to the present, gold has slightly outperformed Bitcoin with a 27.38% increase compared to Bitcoin's 25.9%, demonstrating short-term safe-haven appeal. Bitcoin's price is highly volatile; for instance, in August 2025, its price dropped from a historical high of $124,457 to $118,266, showing a significant weekly decline. In the same period, gold's price corrected from nearly $4,000 per ounce, only declining by 3%-5%, showcasing greater stability.

In terms of liquidity, gold's average daily trading volume is about $150 billion, far exceeding Bitcoin's $50 billion to $70 billion. However, Bitcoin benefits from 24/7 trading and efficient settlement, making it more flexible in the digital economy.

Institutional Fund Flows: The Rise of Digital Gold

The attitude of institutional investors plays a crucial role in the market performance of Bitcoin and gold. In 2025, the U.S. spot Bitcoin ETF attracted significant inflows, such as BlackRock's iShares Bitcoin Trust, which has surpassed $86 billion in assets under management. Meanwhile, gold ETFs have seen outflows, indicating that some institutional investors are beginning to shift funds from traditional safe-haven assets to "digital gold."

However, gold remains the primary reserve asset for global central banks, and its mature regulatory framework and market infrastructure are difficult for Bitcoin to match in the short term. For Bitcoin to become a global reserve asset, it would need to drive hundreds of trillions of dollars in incremental funds into the market and prompt central banks to make large-scale adjustments to their reserve structures, a process fraught with challenges.

Scarcity and Technological Risks

The design of Bitcoin's scarcity is at the core of its appeal. Its fixed supply and halving mechanism ensure a long-term decline in inflation rates, making it theoretically scarcer than gold. However, gold's 5,000-year history as a store of value and its broad practical utility solidify its status.

Bitcoin also faces technological risks. For example, its high-energy mining mechanism is controversial, and future developments in quantum computing may pose threats to blockchain security. In contrast, gold, as a physical asset, is not directly affected by technological risks, but its mining and storage costs are high, and its liquidity is lower than that of Bitcoin's digital transactions.

Market Perspectives: Bullish vs. Bearish Views

Market analysts are divided on whether Bitcoin can surpass gold. Bears, such as senior commodity strategist at Bloomberg Intelligence, believe that if Bitcoin falls below the equivalent level of 35 ounces of gold (approximately each Bitcoin being less than 35 times the current gold price), it may lose its appeal, and funds could flow into U.S. Treasury bonds. They question Bitcoin's long-term resilience as a hedging tool.

Conversely, bulls are optimistic about Bitcoin's future. The Bitcoin Intelligence Report predicts that Bitcoin's price could reach $150,000 to $200,000 by the fourth quarter of 2025 and exceed $1 million by 2035. The co-founder of BitMax even believes that Bitcoin could reach $250,000 by the end of 2025. These optimistic forecasts are based on Bitcoin's scarcity, increased institutional adoption, and growing global acceptance of digital assets.

Future Outlook: Competition or Coexistence?

In just over a decade, Bitcoin has grown from nothing to become the fifth-largest asset globally, with a market value reaching 10.09% of gold's. This speed is rare in financial history. However, to surpass gold, Bitcoin must overcome multiple obstacles, including structural adjustments in the global financial system, improvements in the regulatory environment, and the resolution of technological risks.

For investors, Bitcoin and gold are not a zero-sum game. Gold, with its stability, is suitable for risk-averse investors, while Bitcoin's high growth potential attracts those seeking high returns. A reasonable investment portfolio can combine both based on risk preferences and goals. For example, conservative investors may use gold as their primary safe-haven asset, while aggressive investors may increase their allocation to Bitcoin to capture long-term growth.

Conclusion

Bitcoin surpassing Google's market value marks the rise of digital assets in the global financial system. However, compared to gold's massive market capitalization of $23.22 trillion, Bitcoin still has a long way to go. Its remarkable growth rate and unique scarcity design are noteworthy, but gold's stability, historical significance, and practical value remain irreplaceable. In the future, Bitcoin and gold may form a complementary relationship in the value storage domain. For investors, understanding the characteristics of both and flexibly allocating based on their needs will be the best strategy to navigate this transformative era.

Note: This article is adapted from the YouTube AIBlockTalk blog program and is for educational reference only, not constituting any investment advice.

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