- Gold’s rapid rise is being linked to declining trust in fiat money and institutions, driven by debt, money printing, and geopolitical risk.
- Governments are increasingly seeking assets resistant to seizure or interference, reinforcing gold’s appeal.
- In that environment, crypto’s decentralised features are becoming more relevant, even as US regulatory uncertainty persists.
Gold’s surge above US$5,000 (AU$7,250) per troy ounce is being interpreted as a warning sign about confidence in fiat currencies and institutional safeguards, according to Bitwise Chief Investment Officer Matt Hougan.
After rising 65% during 2025 and a further 16% in 2026, gold has added roughly half of its dollar-denominated value in just 20 months, despite being used as money for more than 2,000 years. Hougan attributed the move to the cumulative effects of prolonged money creation, rising debt levels, and currency debasement across major economies.
He said the rally also reflects growing reluctance to hold wealth in systems dependent on political discretion or third-party trust. That concern intensified after the US seized Russian treasury assets in 2022 following the invasion of Ukraine, prompting central banks to double annual gold purchases to reduce exposure to external control.
More recently, German economists urged the repatriation of gold stored at the New York Federal Reserve, while a Norwegian government panel warned sovereign wealth could face increased taxation, regulation, or confiscation risks.
Related: Stablecoin Surge: Threat or Boon?
What Gold’s Surge Means for Digital Assets
Against this backdrop, Hougan argued that crypto’s defining features are becoming increasingly practical rather than theoretical.
He said assets like Bitcoin enable ownership without reliance on centralised institutions, while blockchain networks such as Ethereum and Solana operate under fixed rules that cannot be altered by any single authority. Terms such as “self-custody” or “censorship resistance” are therefore gaining relevance as institutional trust deteriorates globally.
At the same time, Hougan highlighted uncertainty surrounding the US CLARITY Act, with prediction market odds of passage falling from about 80% to roughly 50% following recent setbacks. He said approval could drive a sharp rally, while failure may force crypto into a prolonged period where real-world adoption determines market outcomes.
Related: Winter Storm Freezes Crypto Rulemaking in Washington
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