Why Bitcoin Has Not Acted as a Traditional Hedge During Conflicts, Inflation, and Tariffs
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Bitcoin has often been portrayed as “digital gold,” an uncorrelated hedge against inflation, currency debasement, and geopolitical risk. Yet in practice, it has not consistently behaved like traditional safe-haven assets such as gold. In the past few days, escalations in the Middle East and tariff-driven market uncertainty exposed a divergence between Bitcoin’s price behavior and that of gold.
Since the heightened geopolitical risk began in late February to early March 2026, gold prices surged to multi-week highs, climbing above $5,300 per ounce. Meanwhile, Bitcoin traded lower or sideways amid diplomatic escalations in the Middle East.
Gold’s Historic Role
In the opening days of March 2026, tensions involving U.S. and Israeli strikes on Iran drove gold higher, reinforcing its role as a traditional safe haven. Spot gold rose to over $5,376 an ounce, a significan…
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