Cryptocurrency and precious metals capital rotation accelerates, gold's future trend faces tests

Bitcoin rapidly reached the $90,000 mark in early 2026, becoming a highlight at the start of the year. According to the latest market data, BTC is currently priced at $90.77K, up approximately 4% over the past four days, reaching a high of about $90,768 on January 3rd. Meanwhile, gold (XAU) and silver (XAG) experienced significant declines, dropping over 4% and 13% respectively within four days. What does this contrast reflect?

Capital Shift from Traditional Assets to the Crypto Market

The pullback in gold and silver is not an isolated event but a signal of market capital structure adjustment. When traditional safe-haven assets lose appeal, institutional investors begin seeking new risk hedging tools. Ethereum (ETH), as a secondary crypto asset, also recorded a positive performance of 0.39% during the same period, maintaining a synchronized upward trajectory with Bitcoin.

US cryptocurrency-related stocks also strengthened in tandem, further confirming this shift. BlackRock’s spot Bitcoin ETF IBIT saw a net cash inflow of $471 million on Friday alone. Coinbase Global Inc. closed up 4.6%, at $237.88; MicroStrategy (NASDAQ: MSTR) also rose 3.4%, closing at $158.5 after hours.

Turning Point in Gold’s Future Trend Has Emerged

Market participants’ views on gold’s future trend are now diverging. Renowned trader Garrett Jin pointed out that gold and silver have peaked, and capital is accelerating its shift toward the crypto market. According to on-chain data from Arkham, the billionaire whale addresses associated with Jin have flattened their long positions. This trader has a track record of accurate predictions regarding Bitcoin’s price movements.

“Even if the stock market opens with a sell-off, cryptocurrencies continue to rise. Capital inflows may persist, upward momentum could accelerate, triggering a wave of short squeeze without retracement.” Garrett Jin commented.

Long-term Pressure on Gold’s Future Trend

Against the backdrop of capital rotation, the outlook for gold’s future trend is concerning. First, Bitcoin, as a politically neutral and attack-resistant global asset, is becoming the preferred choice for a new generation of institutional capital. Second, the strong fundamentals accumulated by Bitcoin in 2025, combined with market expectations of clearer cryptocurrency regulation led by the US, further reinforce bullish sentiment.

Wall Street analysts, led by Tom Lee, are also optimistic that Bitcoin can profit from the correction in the precious metals market in 2026. This suggests that gold’s future trend faces not only short-term adjustments but also a decline in medium- to long-term asset allocation weight.

The total cryptocurrency market cap has risen to approximately $3.07 trillion at the time of writing, up over 2% from earlier, driven significantly by altcoins. As the four-year Bitcoin cycle effect matures, the trend of utility surpassing hype has become inevitable. In this broader context, gold’s future trend is likely to be pressured, especially as global risk assets are re-evaluated.

The price movements in the coming weeks will have a significant impact on gold’s performance within the next three months. Continued institutional capital bets will accelerate the rotation of capital from traditional safe-haven assets to crypto assets, further increasing downward pressure on gold’s future trend.