Gold, the world’s first asset valued at $30 trillion, has surpassed expectations in 2025, rising more than 60% so far this year to trade at approximately $4,340 an ounce.
One way to assess the strength of gold is by measuring its performance relative to the M2 money supply. (M2 refers to a broad measure of money in circulation, including cash, checking deposits, and savings accounts.)
Since its 2022 low, gold has gained approximately 150% against M2. However, it is now approaching historically significant levels last seen during the 2011 and 1974 peaks. This could suggest that the current rally is approaching a peak.
On the other hand, it may also indicate that the bull market has much further to go. For example, during the stagflationary cycle of the 1970s, gold rose an additional 180% against the M2 money supply before peaking.
Gold performance against Bitcoin
Gold’s outperformance extends beyond the money supply. The gold/bitcoin ratio has increased around 50% so far this year.
Bitcoin is now priced at around 24 ounces per BTC, around 40% below its all-time high set in December 2024. Additionally, bitcoin’s total market capitalization now represents around 7% of gold’s total market value.
Bitcoin is approaching a market capitalization of $2 trillion, which corresponds to a price level of approximately $100,000. This price is also closely aligned with its 365-day moving average (365DMA).
The 365DMA calculates the average closing price of an asset over the previous 365 days, which helps identify long-term trends and possible support or resistance levels.
