Gold is set for an unprecedented rally in 2025 as Bitcoin continues its slow activity as the year ends. Bitcoin enjoyed a spark towards the latter end of 2024, with the asset bursting out after a Trump-fuelled rally.
It is no surprise that it did a remarkable job hitting over $100k this year. While Bitcoin did about 50% since November 3, other assets followed suit, with Dogecoin posting double its price.
While the crypto assets enjoyed a stellar run towards the end of the year, gold has been dominating, having itself a wonderful year. Prices of the precious metal surged by 28%, pushing financial investors back to the asset as a safe haven amid rising geopolitical and economic tensions. Gold started the year at $2014, having itself a wonderful year amid several highs before hitting $2,719 in late November.
Experts predict a wonderful 2025 for gold
Usually, most assets in the financial market experience a pullback after a huge rally like gold’s. Investors are conversant with the market, more reason why they remain unfazed by the asset’s recent drop to around $2,603. But with many Western countries starring inflation in the eye amid other geopolitical issues, investors are predicting a great 2025 for gold.
Gold Bullion Company’s Managing Director Rick Kanda lauded the asset’s rise in 2024, noting that it was a record year for the asset. “There’s no denying that 2024 has been a record year for gold,” Kanda said. He also made bold predictions about the precious metal heading into the new year. “It’s reached colossal new highs and broken records. This is… a result of economic uncertainty, changes in global inflation, and also increased demand,” he added.
Gold has usually done well, especially when investors shift their funds into the asset while relying less on bond markets and equity. The popular notion is that gold also serves other purposes, giving it an inherent value. For instance, aside from its use as a currency, the asset is also used to mark jewelry and other technological products.
According to UK-based gold marketplace Bullion Vault, investors are skeptical about the current global situation getting better next year. With Donald Trump preparing to enter the White House, experts are expecting several conflicts. In addition, the platform says it expects its users to consolidate their positions instead of selling. The recent survey carried out by the firm among its users shows that they believe the asset could hit $3,070 by 2025. Most of the respondents cited geopolitical tensions and economic issues driving the growth of the yellow metal.
Donald Trump’s Bitcoin crusade amid rising debts
With most people using the economic situation and geopolitical tensions as their reasons for holding gold, others are pointing to the increase in sovereign debt. Economies across the West are currently witnessing huge deficits as economic growths continue to mount pressure on countries to increase state spending. This trend had previously emerged in 2007/8 with the pandemic causing it to worsen.
Meanwhile, Donald Trump may be relying on his new-found Bitcoin love. With most countries pushing to establish their Bitcoin reserve, the United States is looking to lead the pack. President-elect Donald Trump recently confirmed plans for a national Bitcoin reserve after Bitcoin hit above the $100k mark for the first time. In his speech at the New York Stock Exchange (NYSE), Trump said the United States could do something nice with BTC.
He highlighted the need to be ahead of other countries, a notion that the incoming United States President has always echoed. “We’re gonna do something great with crypto because we don’t want China, or anybody else… but others are embracing it, and we want to be ahead,” he said. However, the idea seems not to resonate with everyone as critics have poked holes in the strategy.
Skeptics are seeing the move as the United States government playing a fool. They see the strategy as an avenue to run up borrowing costs, which could prove dire for the country. It could worsen the already bad inflation numbers, and the dollar would be at the receiving end. A Bitcoin reserve could also open financial institutions up for Bitcoin adoption, allowing customers to use the asset as collateral for loans. If the asset drops, it could prove costly for the financial institution.
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