What a 12 months it has been for Bitcoin(CRYPTO: BTC) to this point. The world’s prime cryptocurrency hit an all-time excessive of $109,000 in January after which fell to as little as $75,000 in April. Now, it has recovered and simply hit a new all-time excessive of $112,000 on Could 22.
Unsurprisingly, many traders are confused about the place Bitcoin is headed subsequent. Will it proceed to soar greater? Or is it overvalued, and prepared for one more market correction?
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Is Bitcoin a tech inventory or “digital gold”?
One motive for all this confusion is that traders do not actually know what to make of Bitcoin. Cryptocurrency is complicated sufficient, and Bitcoin does not make it any simpler.
At occasions, Bitcoin seems to behave like a high-risk, high-reward tech inventory. It at present has a market cap of $2.2 trillion, which is almost similar to the market caps of Alphabet and Amazon.
At different occasions, although, Bitcoin seems to behave like a potential hedge in opposition to macroeconomic uncertainty, identical to gold. As a consequence, some traders have began to view Bitcoin as a potential protected haven asset.

Picture supply: Getty Photographs.
The continued tariff drama has made this twin nature of Bitcoin very apparent. As quickly as President Donald Trump introduced sweeping, across-the-board tariffs on April 2, Bitcoin bought off, as did most tech shares.
But as Bitcoin started to stabilize, it quickly grew to become modern to speak about it as “digital gold.” In different phrases, traders began to view Bitcoin — a digital asset largely unaffected by world commerce flows — as a potential hedge in opposition to tariff uncertainty.
And that is precisely when Bitcoin started to decouple from the tech market. Tech shares had been nonetheless falling, but Bitcoin was rising in worth. The “digital gold” funding thesis appeared to make sense. It was apparent that tech corporations with vital abroad operations had been going to get hit exhausting by tariffs, but possibly Bitcoin would not.
The issue is that you would be able to’t have it each methods. Bitcoin cannot be each a tech inventory and “digital gold,” can it? One thing simply does not add up. If markets are bullish, then Bitcoin trades like a tech inventory? But when markets are bearish, Bitcoin immediately undergoes a transformation and trades like gold? To me, that argument sounds a lot like, “Heads I win, tails you lose.”
Bitcoin’s upside potential
Apparently, analysts and traders are beginning to current totally different value forecasts for Bitcoin, primarily based on how they view this asset.
In a single situation, Bitcoin trades like a tech inventory and is able to excessive future returns. That is the Bitcoin we all know and love — the sort of digital asset that turned in triple-digit returns in 2023 and 2024, and that has commonly been the top-performing asset in the world.
In one other situation, although, Bitcoin trades like gold. It loses a few of its attribute volatility, but it additionally loses a few of its upside potential. Keep in mind: On Wall Avenue, there isn’t any such factor as a free lunch. You’ll be able to’t have each excessive upside and low danger at the identical time.
In late April, funding agency 21Shares issued a report referred to as “From Digital Asset to Protected Haven: Why Is Bitcoin Appearing Like Gold?” It urged that Bitcoin would proceed to slender the efficiency hole with gold over the the rest of 2025. In the event you purchase into the argument that “digital gold” ought to carry out equally to bodily gold, this makes a lot of sense.
But guess what? That thesis additionally implies that Bitcoin is not a digital asset able to large, triple-digit returns. Just have a look at the historic returns for gold. Over the previous 15 years, the single finest 12 months for gold was 2010, when it returned 27.7%. But the annualized returns for gold are normally a lot much less spectacular. They’re usually round 10% (over the previous 10 or 20 years).
Tariff uncertainty is the wild card issue
The wild card consider all this, in fact, is tariffs. On Could 23, simply at some point after Bitcoin hit its all-time excessive of $112,000, President Trump threw sand into the gears of the crypto market. He urged that fifty% tariffs on Europe had been incoming. He additionally urged that tech corporations comparable to Apple refusing to maneuver operations again to the United States is perhaps going through extra tariffs.
As quickly as this information got here out, Bitcoin instantly declined to $109,000. So, wait, is Bitcoin now a tech inventory? It stays to be seen what occurs subsequent. But issues simply received complicated once more (President Trump has already delayed the 50% tariffs on Europe).
That is the danger of investing in Bitcoin. For brief durations, it will possibly behave like “digital gold.” But, most of the time, it behaves far more like a high-risk, high-reward tech inventory. In the event you’re occupied with investing in Bitcoin now, you could be snug with the place you assume the tech market is headed in 2025.
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Suzanne Frey, an government at Alphabet, is a member of The Motley Idiot’s board of administrators. John Mackey, former CEO of Entire Meals Market, an Amazon subsidiary, is a member of The Motley Idiot’s board of administrators. Dominic Basulto has positions in Amazon and Bitcoin. The Motley Idiot has positions in and recommends Alphabet, Amazon, Apple, and Bitcoin. The Motley Idiot has a disclosure policy.