Gold, the world’s first-ever US$30 trillion asset, has beaten expectations for 2025, rising more than 60% year-to-date to trade at approximately US$4,340 per ounce. ounces.
One way to assess gold’s strength is by measuring its performance against the M2 money supply. (M2 refers to a broad measure of money in circulation, including cash, checking deposits, savings accounts).
Since the bottom in 2022, gold has risen about 150% relative to M2. But it is now approaching historically significant levels last seen during the peaks of 2011 and 1974. This could indicate that the current rally is nearing a peak.
On the other hand, it may also indicate that the bull market has much longer to run. For example, during the stagflation cycle of the 1970s, gold rose another 180% relative to the M2 money supply before reaching its ultimate peak.
Gold vs Bitcoin performance
Gold’s outperformance extends beyond the money supply. The gold/bitcoin ratio is now up about 50% year-to-date.
Bitcoin is now priced at approximately 24 ounces per BTC, about 40% below its all-time high in December 2024. Additionally, bitcoin’s total market cap now represents about 7% of gold’s total market cap.
Bitcoin is approaching a market cap of $2 trillion, which equates to a price level of around $100,000. This price also closely matches its 365-day moving average (365DMA).
365DMA calculates the average closing price of an asset over the previous 365 days, which helps identify long-term trends and potential support or resistance levels.
