As Bitcoin Gains Ground, the Traditional Safe Haven Role of Gold and Bonds May Be Waning

Bitcoin’s Role as a Safe Haven: A New Perspective Amid Changing Financial Realities

Bitcoin might not traditionally be considered a safe haven, but in today’s volatile world of rising sovereign risk and fractured financial norms, it’s time to reconsider what “safe” really means.

For years, the safe haven assets—gold and government bonds—have been the go-to choice for investors looking to safeguard their capital during market turmoil. These assets were viewed as stable, predictable, and resilient, making them the foundation of risk management strategies for decades. However, in the current era of non-stop markets, geopolitical instability, and growing distrust in sovereign systems, the old formula is increasingly being questioned. Is it time for a new definition of a safe haven?

Enter Bitcoin.

While Bitcoin is often seen as highly volatile and speculative, it has staged an incredible rise since the global market lows of 2020. Its 1,000% increase since the COVID-19 market crash stands in stark contrast to long-duration bonds, which have lost 50% of their value over the same period. Even gold, typically considered the ultimate safe haven, has risen by 90% over the past five years, but its value looks less impressive when adjusted for the massive money printing in 2020 that saw more than 40% of the total U.S. money supply introduced.

Despite Bitcoin’s impressive performance, its role as a safe haven is still debated. In recent risk-off events, Bitcoin has acted less like a safe haven and more like a high-beta risk asset:

• COVID-19 (March 2020): Bitcoin dropped 40%, while the Invesco QQQ ETF fell 27%.
• Bank Crisis (March 2023): Bitcoin fell 14%, compared to QQQ’s 7% drop.
• Yen Carry Trade Unwind (Aug 2024): Bitcoin dropped 20%, while QQQ was down 6%.
• Tariff-induced Selloff (April 2025): Bitcoin fell 11%, but the Nasdaq dropped 16%.

The first three examples suggest that Bitcoin behaves more like a leveraged technology stock than a safe haven. However, in the most recent tariff-induced selloff, Bitcoin showed resilience, falling less than the Nasdaq, which points to strength in a weak market triggered by President Trump’s tariffs.

While these individual events don’t create a clear trend, they indicate a larger shift: the financial landscape is changing.

According to NYDIG Research, “Non-sovereign stores of value like Bitcoin should perform well in the current climate. Politically neutral assets are less likely to be affected by the geopolitical turmoil playing out on the global stage.”

Bitcoin may be volatile, but it offers unique attributes—global liquidity, decentralization, censorship resistance, and immunity to government policy—that make it stand out in an era marked by geopolitical risks and financial uncertainty. These qualities could make Bitcoin a more reliable store of value than traditional safe havens.

Meanwhile, conventional safe havens such as gold and long-duration bonds are under pressure. Gold’s recent gains seem meager when compared to the scope of global money printing, and long-duration bonds are struggling as 30-year Treasury yields near 5%, putting strain on portfolios that rely on them.

Since last Thursday’s market correction, Bitcoin has fallen 6%, the Nasdaq has dropped nearly 10%, long-duration bonds (TLT) have decreased by over 4%, and gold has lost more than 3%. In contrast, the U.S. Dollar Index (DXY) has remained flat, while the 10-year Treasury yield has surged by nearly 8%.

In terms of risk-adjusted performance, Bitcoin has managed to hold its ground, performing comparably to traditional safe havens like gold and TLT.

Looking back at these major risk events, we see a pattern: each Bitcoin sell-off has been followed by a significant rebound. During the COVID-19 crash, Bitcoin bottomed out around $4,000—levels it has never revisited. In March 2023, during the banking crisis, it briefly dipped below $20,000 before continuing its upward trajectory. In the August 2024 yen carry trade unwind, it fell to $49,000—another level that hasn’t been seen again. If history is any guide, the current low may set a new long-term floor for Bitcoin’s price.

So, is Bitcoin truly a safe haven?

If we define a safe haven by traditional standards—low volatility and protection during market crises—Bitcoin doesn’t quite fit the bill.

However, in today’s financial world, where sovereign risk, inflation, and constant policy uncertainty dominate, Bitcoin offers unique benefits: durability, neutrality, and liquidity. These attributes are becoming increasingly important as traditional safe havens fail to deliver on their promises in a shifting global landscape.

Perhaps Bitcoin isn’t failing the safe haven test. Instead, it could be that the definition of what constitutes a safe haven needs to be updated to reflect the evolving dynamics of modern finance.