JPMorgan's research team led by Managing Director Nikolaos Panigirtzoglou has documented a divergence between Bitcoin and gold ETFs since the outbreak of the Iran war. SPDR Gold Shares (GLD) lost roughly 2.7% of its AUM since February. BlackRock's iShares Bitcoin Trust (IBIT), by contrast, gained 1.5% over the same period.
In the first three weeks of March, gold ETFs saw outflows of nearly USD 11 billion. Bitcoin benefited from the reallocation and, according to JPMorgan analysts, displays the classic behaviour of a safe haven. Gold gave up about 15 percent over the month, after the metal had marked a record high of roughly USD 5,500 per ounce in January 2026.
Subscribe to our newsletter
The best articles of the week, directly delivered into your mailbox.
Mechanics of the debasement trade
Investors coined the term "debasement trade" in October 2024. It describes an investment strategy in which investors buy gold and Bitcoin in parallel to hedge against currency debasement. The drivers are high government deficits, inflationary pressure, geopolitical risks and waning trust in central banks. By the end of 2024, gold ETFs led investor preference. In the fourth quarter of 2025, the relationship tipped back in favour of gold as Bitcoin inflows stagnated.
However, the picture changed with the US air strikes on Iranian territory on 27 February 2026. Instead of seeking traditional safety in gold, investors rotated on a net basis into Bitcoin. JPMorgan points out that IBIT inflows since 2024 are now roughly twice as large as GLD accumulation over the same period. As a result, the divergence cancels out gold's earlier year-on-year outperformance versus Bitcoin, although it does not fully erase the metal's strength from the fourth quarter of 2025.
Capital flows and market structure
Furthermore, the breakdown of market participants behind the Bitcoin inflows deserves a second look. According to JPMorgan, ETF purchases come predominantly from retail investors and registered investment advisors (RIA). Hedge funds, in contrast, are positioning in the opposite direction. Short interest in IBIT has risen since the start of the war, while short positions in GLD have declined. The Panigirtzoglou team interprets this constellation as a hedging strategy rather than fundamental scepticism. In the precious metals complex, silver provides the clearest counter-example. ETF inflows from recent months have completely reversed.
In addition, the Bitcoin-to-gold volatility ratio fell to roughly 1.5 according to JPMorgan, a record low. On a risk-adjusted basis, Bitcoin's standing relative to gold therefore continues to improve. JPMorgan uses precisely this ratio as the foundation for longer-term models that place Bitcoin, on a volatility-adjusted basis, in a range up to USD 266,000. These targets, however, stem from separate reports published in late 2025 and early 2026 and do not belong to the Iran-specific debasement trade framework.
Iran as a stress test for the safe-haven narrative
In Iran itself, crypto activity rose by 700 percent after the outbreak of war, according to Chainalysis data. Iranian users moved funds from local exchanges into self-custody and onto international platforms. Panigirtzoglou frames this as evidence of cryptocurrencies' function under geopolitical pressure.
"The surge in crypto activity in Iran underscores the role of cryptocurrencies as a safe haven in countries suffering from economic and monetary instability as well as geopolitical pressure." - Nikolaos Panigirtzoglou, JPMorgan
Western ETF investors operate from a different position, yet the logic converges. For anyone watching sanction risks, reserve currency questions and deficit financing at the same time, Bitcoin offers a hedging layer that gold, at least in the current phase, no longer provides exclusively. Moreover, Bitcoin's independence from traditional precious-metal custody infrastructure further relieves portfolios in a phase where physical supply chains can become political.
On 7 May 2026, media outlets are reporting on potential US-Iran negotiations and a 14-point memorandum to end hostilities. Brent crude fell to USD 97.61 per barrel as a result, after oil had temporarily traded above USD 100. Bitcoin trades at roughly USD 81,000 and gave up about 1.96 percent on the day itself. Gold stands at approximately USD 4,752 per ounce, around 14 percent below the January high. A de-escalation would dampen the acute safe-haven impulse. Therefore, the structural argument of the debasement trade remains untouched.
