Gold, Silver and Bitcoin Slide as Debasement Trade Loses Steam

Gold, silver and bitcoin all moved lower as the market’s 2025 debasement trade continued to unwind. Gold has dropped roughly 28% from its January 2025 peak of $5,600 per ounce and is now below $4,000, while silver has fallen more than 50% from a record high near $120 and slipped under $59 on Wednesday. Bitcoin is also under pressure, trading below $62,000 after a 50% correction from its October all-time high.

The pullback matters because it challenges one of last year’s dominant macro narratives: that fiscal deficits and rising government debt would keep supporting assets viewed as hedges against fiat currency debasement. Instead, investors are now weighing the possibility of tighter monetary policy, with markets pricing in two 25 basis point Federal Reserve rate hikes by March 2027.

CoinDesk attributed the shift largely to renewed inflation concerns and expectations for policy tightening under new Federal Reserve Chair Kevin Warsh. If rates rise to the 4.00%-4.25% range, as markets currently imply, the backdrop for non-yielding assets such as gold, silver and bitcoin becomes less straightforward.

Bitcoin’s role in the trade has been especially debated. While gold and silver rallied sharply through much of 2025, bitcoin spent much of that period near the $100,000 level, raising questions about whether it was still behaving like a hedge against currency dilution.

Even so, bitcoin has performed better than the metals on a relative basis since February. CoinDesk reported that bitcoin has gained about 30% against gold and more than 55% against silver since those ratios bottomed, although all three assets have lagged U.S. equities in 2026 as momentum remains concentrated in semiconductor and memory-related stocks.