Bitcoin, after outperforming most asset classes in 2024, is now under pressure as Donald Trump’s potential White House return and rising geopolitical tensions drive investors toward traditional safe-haven assets.

Year-to-date, Bitcoin has gained just over 3%, lagging behind gold’s 9% surge, according to Bloomberg data.

Gold hit a record $2,882 per ounce after Trump’s Feb. 4 remark about a possible U.S. takeover of Gaza, which his aides later sought to clarify, while Bitcoin remains about 10% below its peak.

Although Bitcoin is often compared to gold as a store of value due to its fixed supply of 21 million tokens, it has yet to fully establish itself as a safe-haven asset.

Gold’s resilience during economic uncertainty has been reinforced by events like the U.S.-China trade war and tariff threats. In contrast, Bitcoin has largely mirrored the movements of technology stocks, rather than acting as a hedge against market turmoil.

A senior investment advisor at Moneta Group LLC, Aoifinn Devitt, said that that Bitcoin may act as a hedge against fiat currency, but its attractiveness is diminished in a market where the U.S. dollar remains in high demand.

“In time it will have its own characteristics that act separate and apart from markets but at this point it is behaving as the riskiest of risk-on assets,” Devitt said.

However, the Senior Director at market maker Wincent, Paul Howard, stated that the introduction of exchange-traded funds (ETFs) investing directly in Bitcoin will gradually reduce volatility, prompting investors seeking high-risk opportunities to shift toward more speculative cryptocurrencies.