Should you invest in gold or crypto?

Similarities between gold and crypto

Investors appear to have piled into both crypto and gold in the later part of this summer. Gold was a standout asset during 2025 with gains of 64% during the year, though the price of gold has fallen off in 2026 after hitting an all-time high of $5,595 on 29 January.

Similarly, cryptocurrencies endured a challenging start to the year. The price of Bitcoin, the largest and most influential cryptocurrency, fell 28% between the start of the year and 31 July, while Ethereum, the second largest, fell 37% over the same period.

However, there has been a partial recovery in August and September, particularly in crypto markets; across these two months, gold gained 2% and Bitcoin gained 33% (as of market close on 28 September).

“Record inflows into Bitcoin and gold exchange-traded products (ETPs) have fuelled the rally in both assets recently,” said Francesco Paganelli, principal, manager research at Morningstar.

Paganelli added that August saw the strongest inflows into gold ETPs in five years, while the recent spate of buying marked “a sharp turnaround for global Bitcoin products”.

It makes sense that gold and crypto markets sometimes move in tandem since there is some overlap in the investment case for both asset types. In theory, both function as stores of value or a means of exchange that, unlike fiat currencies, have a finite supply.

Only so much gold has been and ever will be mined, while most cryptocurrencies have scarcity built into their design. There will, for example, only ever be 21 million Bitcoin produced (the process by which they enter circulation is known as ‘mining’).

That means both asset classes can be viewed as a hedge against inflation; if the value of a currency (particularly the US dollar) shrinks, it takes more of that currency to buy a given amount of gold or crypto.

Market drivers and volatility

By extension, both are sensitive to changes in interest rates (again, particularly in the US as both asset classes are usually priced in dollars). If expectations for higher US interest rates increase, it is reasonable for gold and crypto prices to fall, because there is a higher likelihood that US inflation will be lower – and vice versa.

“A common driver appears to be the de-dollarisation trade, whereby investors seek to reduce their reliance on US dollar-denominated assets,” said Morningstar’s Paganelli. “After years of exceptional US equity market performance, many portfolios have become increasingly concentrated in dollar-linked exposures.

“At the same time, rising government bond yields are making bonds less effective as a safe haven, prompting some investors to look elsewhere for assets they perceive as alternative stores of value.”

However, the two are not perfectly correlated. Historically, Bitcoin has tended to perform in risk-on market conditions, while gold has done better in risk-off environments. 2026 has been an exception to that rule – the gains that gold made last year and the outsized impact that interest rate expectations have had on price movements this year have made it behave more like a risk-on asset.

How to invest in gold and crypto

You can buy a wide range of funds or ETPs that give exposure to gold and crypto prices individually. The rules for crypto ETPs are evolving; as of April 2026, crypto ETPs can only be held in an Innovative Finance ISA (IFISA), not a stocks and shares ISA – though as of October 2025 they are eligible to be held in a self-invested personal pension (SIPP).

One product that offers exposure to both assets in one is the 21Shares Bitcoin Gold ETP (LON:BOLD). The ETP invests in both gold and Bitcoin, and adjusts the balance between each asset based on their inverse volatility, meaning the amount of risk you are exposed to from each is equal. As with other crypto ETPs, BOLD can only be held in a SIPP or an IFISA.

As of 28 September, BOLD’s underlying assets were allocated 53.1% to gold and 46.9% to Bitcoin. Before buying either gold or crypto, though, you should consider where each fits into your portfolio and your risk appetite.

“History shows that crypto's sharp rallies can be followed by equally sharp reversals,” said Paganelli. “With both gold and bitcoin experiencing elevated volatility in recent months, investors should be particularly disciplined about the size and timing of any allocation to either asset class.”