Bitcoin struggles with its critical challenge as an 11-month decline indicates a failure as a “store of value.”

The narrative of Bitcoin’s year is often framed through the lens of the dollar chart, a familiar perspective that captured a tumultuous fourth quarter where BTC fluctuated within a turbulent two-month range.

The price surged to approximately $124,700 in late October before declining toward the mid-$80,000s in November, a movement that wiped out over $40,000 from peak to trough.

The volatility was significant enough that traders spent much of the autumn questioning whether the overall structure remained sound, even as the market sought to recover from that shock. However, if one removes the dollar perspective entirely and assesses the same timeframe in ounces of gold, the narrative changes once more.

This alternative view uncovers a development that has largely gone unnoticed amid the chaos: an 11-month decline that has driven the BTC/XAU ratio down roughly 45% from its January 12 weekly peak, a trend that persists even after a slight uptick in early December.

Graph illustrating the price of Bitcoin expressed in gold (BTCXAU) from January 1 to December 12, 2025 (Source: TradingView)

The bear not visible on the dollar chart

In terms of weekly closes, Bitcoin is only about 10% below its January levels when measured in dollars, but this slight numerical decrease conceals the reality that the journey from peak to present included one of the most volatile periods of the year, characterized by a rapid ascent toward $125,000 followed by a swift drop into the $80,000s within just a few weeks.

Even after stabilizing into mid-December, recovering from $89,348 on December 5 to just over $92,300 by December 12, the ratio to gold presents a markedly different scenario: a decline more than four times larger, spanning nearly a full year without respite.

This disparity between episodic volatility in dollars and ongoing weakness in ounces prompts a broader discussion about what “real” returns appear to be for investors who consider Bitcoin as a hard asset.

Part of the decline in the ratio is, naturally, attributable to gold’s own surge as real-rate expectations diminished and geopolitical unrest heightened demand for safe havens.

The strength of gold compresses any asset priced against it. However, even accounting for that, a ratio that has consistently decreased for 46 consecutive weeks signals a significant indication of how capital has assessed hard-asset risk throughout 2025.

Even the recent slight increase in the ratio, approximately a 2–3% change from December 5 to December 11, did not alter the overarching trend or threaten the downward structure that has been established since January.

The autumn volatility in BTC/USD only emphasized this: even as Bitcoin recovered from its November lows and gained a few thousand dollars this week, it never approached reversing the broader underperformance relative to gold.

This is where cross-asset benchmarking proves useful rather than merely decorative. Utilizing gold instead of the dollar, or any other fiat currency, eliminates the distortions caused by currency conditions and policy cycles.

It poses a more straightforward question: how many ounces of gold is the market willing to exchange for one unit of digital scarcity? The answer, week after week, has been “fewer than before,” and the consistency of that response holds more significance than the fluctuations of any single selloff or rally on the USD chart.

Insights from cross-asset benchmarking regarding this cycle

The most intriguing aspect of this entire analysis is how clearly the two charts delineate Bitcoin’s dual identities. The USD chart reflects its liquidity-sensitive nature, shaped by dollar availability, ETF flows, and rapid shifts in risk appetite. The autumn turbulence fits neatly into that framework: a leverage-driven surge, a sudden reversal, and a fragile recovery.

Conversely, the XAU chart illustrates Bitcoin’s hard-asset identity, which claims monetary neutrality and long-term reserve potential. On this front, Bitcoin has experienced nearly a full year of decline, with October’s rally barely making an impact and November’s drop merely extending a trend that had already been established since January.

Institutional investors think in these cross-asset terms. They do not simply inquire whether Bitcoin rebounded from a sharp selloff; they consider whether it has outperformed a range of hedges, reserves, and real-asset benchmarks that form the foundation of institutional portfolios.

A year of underperformance against gold compels the Bitcoin narrative to focus more on growth, technology, and adoption, rather than relying on the assumption that digital scarcity inherently functions as a superior hedge. This does not negate that broader narrative, but it does rigorously test it in a manner that dollar-based analysis cannot.

This ratio-based perspective comes with methodological caveats, as all such analyses do. Gold may be entering its own overheated phase, and a shift in liquidity conditions could alter the structure of both sides.

However, these caveats do not diminish the central fact: almost every weekly close since mid-January has pushed the ratio lower, regardless of how dramatic Bitcoin’s USD fluctuations were in October and November or how the market added a few thousand dollars in the second week of December.

The implications for Bitcoin as 2026 approaches

For Bitcoin to emerge from this subdued bear market when measured in ounces, the BTC/XAU ratio must break its eleven-month trend and establish higher weekly highs, something that has not occurred since January.

This would necessitate a combination of Bitcoin’s strength and gold’s stability, a pairing that typically arises only when liquidity expands significantly, and demand for safe havens diminishes.

If, instead, gold continues to rise or simply maintains its position while Bitcoin remains within the aftermath of its autumn volatility, as it has this past week despite last week’s minor recovery, the ratio may drift further, widening the divide between traders who rely on the USD chart and allocators who assess assets through cross-asset frameworks.

Benchmarking shapes the narrative surrounding cycles. The dollar chart illustrates the drama of the autumn selloff and the resilience that followed. The gold chart underscores the fundamental conviction issue that has persisted throughout the year.

As 2026 draws near, that second chart serves as a straightforward test of what Bitcoin still needs to demonstrate: strength not only against a currency that fluctuates with policy cycles but also against other stores of value that occupy the core of institutional allocation.

Until that test is successfully navigated, the ounce-denominated perspective will continue to remind the market that volatility and direction are not synonymous, and that the deeper cycle signal remains the one inscribed in gold.

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