When Safe Havens Compete: Bitcoin Stalls Below $90K While Bonds and Gold Rally

Bitcoin’s struggle to break past the $90,000 level reflects a deeper market shift—one where traditional hedges are outperforming the digital alternative. The cryptocurrency faced significant selling pressure on Monday, triggering nearly $100 million in liquidations, signaling investor skepticism about its near-term trajectory toward six figures.

The Traditional Hedge Advantage

The current market environment has created an unfavorable backdrop for Bitcoin’s store of value narrative. Gold maintains strength above $4,300 as investors flock to risk-aversion strategies, while U.S. Treasury bonds attract capital amid expectations of widening fiscal deficits. According to Rockefeller Global Family Office leadership, policymakers are deploying financial repression tactics to manage bond yields—a development that underscores the competitiveness of fixed-income instruments.

Meanwhile, the S&P 500 continues its record-breaking run in December, drawing liquidity away from alternative assets. With lower interest rates supporting equity valuations and improving consumer credit conditions, Bitcoin’s appeal as an independent store of value diminishes. The altseason index—which tracks the performance of alternative cryptocurrencies relative to Bitcoin—remains constrained, reflecting broader investor preference for traditional markets over digital assets.

Economic Headwinds and Market Psychology

Recent labor market data, showing unemployment at 4.6% (the highest in four years), presented a mixed signal. While historically this might trigger stimulus expectations, inflation concerns keep such hopes in check. This economic ambiguity has kept Bitcoin rangebound, with current price action near $92.54K showing a modest -1.33% decline in the last 24 hours.

The U.S. economy’s resilience in AI infrastructure investment partly offsets tariff-related concerns, but this broad economic strength paradoxically works against Bitcoin. When equities thrive, investors have less incentive to hedge with digital assets.

Mining Sector Faces Margin Compression

Bitcoin mining operations are under mounting pressure from surging energy costs and deteriorating profitability metrics. Hash rates have declined following China’s shutdown of 1.3 gigawatts of mining capacity, forcing miners to pursue debt and equity financing options including secondary offerings just to maintain operations.

However, some market observers, including VanEck analysts, view falling hash rates through a contrarian lens—historically, such periods have preceded positive Bitcoin returns. Companies holding Bitcoin as treasury reserves trade at significant discounts to their asset values, according to BitcoinTreasuries data, creating tension between long-term conviction and short-term valuation pressures.

The Path Forward

Bitcoin’s recovery ultimately hinges on a renewed embrace of its digital gold positioning. However, with bonds offering attractive yields and gold providing tangible security, the narrative may face headwinds until market dynamics shift. For now, traditional hedges maintain their commanding appeal in an environment of macroeconomic uncertainty.