I’m going to explain why gold is ripping (and why Bitcoin is next)

0:00In this video, I'm gonna tell you how to understand gold's recent price rally and why I think it tells us what happens next for Bitcoin. Gold is absolutely ripping right now. It might pass $5,000 in ounce while I'm literally recording this video. It's having its best run in over a decade, but the part that I think nobody really realizes is that strangely enough, the buying that triggered this rally started more than three years ago. You probably know gold was the best performing asset last year in 2025. It did about a 63% return. 63% is damn good, especially for gold. And the gold bugs have really been taking their victory lap, which is fine with me. They deserve it. I'm happy for them. Even though I like Bitcoin and Bitcoin was basically the only asset of every asset class you see on the screen that was negative last year, down about 6%. Wolf, so Bitcoiners, naturally, feeling salty, feeling fomo, sitting on the sidelines, watching the gold bugs and the silver bugs having their day and the sun while we sit in the corner

1:01feeling with our Bitcoins. So naturally, you might wonder, does this gold run up mean you should sell your Bitcoin and buy gold instead? Well, I definitely don't think so. In fact, I think it means the exact opposite because seeing things through the lens of just last year is quite short-sighted. And it really covers up the bigger picture of what's going on here. Because what the gold bugs don't really want to tell you is that the rally they finally got in the last one to two years, they've been basically waiting for it for 12 years. From the beginning of 2012 to the beginning of 2024, gold did basically nothing. It returned 30%. Not per year, but cumulative total in 12 years. About 2% per year for over a decade. I mean, obviously, there's nuance. If you bought it at a low in the middle of that, you would have seen better returns. But generally speaking, if you're a gold bug who bought it at the high in 2012, you waited any turnity to break even. But more importantly than that, was an opportunity cost because they got blown out of the water by basically everything,

2:02especially text talks and of course Bitcoin. So yeah, I am genuinely happy for the gold bugs finally getting their rally. They deserve it after waiting for 12 years. And unfortunately, that long wait is not even really an outlier for gold. Those long waits are actually par for the course. It also happened from 1980 to about 2006. Gold peak at an all-time high around 1980 of about $850 an ounce. Then it fell off a cliff and by the end of 2006, it was around $630 an ounce. That's 26 years for a cumulative loss of 25%. I mean, that is brutal. Maybe that's why Satoshi invented Bitcoin. He might have been a gold bug who was just tired of sitting around waiting. But I kid, because again, the gold bugs have been carrying the sound money torch since before the big corners were even around. So I'm happy to let them have their day and for them to see their thesis playing out on the charts. Because this video is not about bashing gold. Gold bugs and big corners are on the same team, really. We believe in like 99% of the same things

3:03about the problems of money. They are just sticking to a 20th century version of the solution. While big corners are saying, hey, there's a 21st century version of the solution to the problems of money and it actually has a greater chance to work in a digital age. But discussing the flaws that gold has that Bitcoin solves is a video for another time. Because despite the fact that the gold bugs had to wait from 2012 to 2024 to get the rally they've been waiting for, it was really 2022 when everything changed. Examining global flows of gold starting then is going to be the key to us understanding why the gold price finally took off last year and how that potentially foreshadows the same future for the price of Bitcoin. Real quick, you're watching the SadStacker Show, a Bitcoin show for people who think deeper about money. I'm your host. My name is John A.K.A, the SadStacker, A.K.A, SadFinger. SadFinger, pretty short dreams in cold and fear and for no.

4:04If you want to learn to stack smarter, hit the subscribe button. So I've long wondered about this theory that says gold moves first, gold sniffs out the debasement, the liquidity, the rally that's coming, and then Bitcoin moves second. Right now, we have a bunch of macro signals that are pointing to loser monetary policy and more liquidity in the system starting this year. For example, it's deep in the weeds, but you have upcoming changes to bank capital rules like the supplemental leverage ratio, which could free up balance sheet capacity across the financial system and lead to more liquidity. And the theory goes that gold moves on the signal that liquidity will be coming and Bitcoin moves when that liquidity actually shows up. The second half of that clearly tracks with reality as Lynn Alden and Sam Callahan did a research paper a year or so ago that shows that Bitcoin is correlated with global liquidity more than any other asset. More money in the system means the Bitcoin price moves more. But I was still wondering, is this idea true that gold moves first

5:06and that a moving gold's price can actually predict a move in Bitcoin's price? Well, we really haven't seen a move like this in gold since the late 70s, so Bitcoin obviously was not around yet. So it's hard to say how predictive this move really is. But then I came across this interesting post from Bitwise CEO Matt Hogan. Everyone thinks the gold price spiked in 2025 because central bank purchases tilted the supply demand balance. But central bank purchases of gold really spiked in 2022. After the US seized Russia's treasuries and signaled to the world that it's no longer safe to hold US treasury bonds since we're willing to freeze them if you do something we don't like. So it turns out there is a need for a decentralized permissionless non-sovereign global reserve asset that can't be censored or seized at the click of a button. Who knew? But anyways, central bank purchases of gold doubled in 2022 from about 500 tons to about 1,000 tons a year and they've stayed at that level ever since.

6:08Of course, that did shift the supply demand balance, but strangely, it did not show up in the gold price right away. Gold rose 2% in 2022, 13% in 2023, and 27% in 2024. You can see the makings of the run up, but it didn't go parabolic until 2025, which is now continuing into 2026. The reason for that is simple. It's not just demand that makes price skyrocket because if there are enough sellers at a given price level, then price can remain relatively stable even if demand increases because more and more sellers will enter the market to meet that buying pressure. It just means central banks were buying lots of gold, but lots of gold holders were willing to sell their gold at or around those prices, so the price didn't need to gap up significantly in order to coax out a whole slew of new sellers. I covered a similar phenomenon with Bitcoin last year, while everyone was saying all the news about Bitcoin is so bullish, why isn't the price moving higher?

7:08The answer was simpler than basically anybody wanted to admit, it was just a lot of people who were willing to sell their Bitcoin, especially when we were over the $100,000 mark. You can watch that full video right here, if you're interested. I also recently talked to the best Bitcoin on-chain analyst in the business, James Check, about this exact topic that interview is gonna drop on my channel soon, so make sure you subscribe to the channel. But the same theory basically applies here. Madhogan points out that since the Bitcoin ETFs launched in 2024, they have been buying more than 100% of the newly introduced supply of Bitcoin, but the price hasn't gone parabolic. Simply because, like I said, there were enough existing holders who were willing to sell their Bitcoin, but that ETF demand has been remarkably persistent. And as we see more and more institutional adoption and bullish headlines for Bitcoin, its mass belief and mine, of course, that will see continued demand from the ETFs. And we know there's demand from strategy

8:09who just keeps buying by the billions. Bitcoin has shown tremendous resilience since it crashed 30% off its all-time high last year. It never broke below 80,000, and we're already back hovering around or above 90,000 at the time of this recording. Central bank demand for gold doubled in 2022, but the price didn't explode until 2025. There has been a ton of ETF demand for Bitcoin in the last two years. And like Checkmate just told me, those ETF buyers have actually been massive hotlers. Even despite the reason drawdown, the total Bitcoin outflows from ETFs was something like three and a half percent. So if that ETF demand persists, throw that in with the demand from strategy, other institutions, retail, et cetera. At some point, we exhaust the sellers in this price range and buyers have no choice, but to start paying more and more and more dollars to entice new sellers to come to market. That's when Bitcoin does its parabolic move just like gold did.

9:10You see, Bitcoin was down 6% last year. Well, every other asset class was up. You may think that sounds bearish, but I think it sounds bullish as ****. We had an absolute torrent of selling, but demand is holding strong. It's an interesting tweet on the screen. I know this is not technically a super accurate way to do a market cap delta to per coin price translation, but if Bitcoin absorbed the same number of absolute dollars that Gold or Silver absorbed last year, it would easily have pushed Bitcoin's price into the hundreds of thousands or even the millions. This isn't saying Bitcoin will do that, but it's showing how small Bitcoin still is relative to global capital tools and how asymmetric of a bet Bitcoin still is. We are still extremely early, and Bitcoin is tiny compared to much more established assets like gold. Gold is a much more mature and established asset with 5,000 years of history and trust as a store of value, which is obviously the one trait that Bitcoin lacks

10:12is a track record of trust that long. But that too is bullish because it just shows you how much room Bitcoin really has left to run. Just think of it this way. Fiat debatement is such a powerful force that the most globally recognized store of value for 5,000 years, Gold, was still able to double in a little over a year once the supply tightened and the sellers dried up. It might have taken a couple years for the price chart to reflect the real impact of all that demand, but central banks were gobbling up that Gold and sticking it in vaults with no intention of letting it back out, which means that once willing sellers were exhausted, the only pressure relief valve left was the price. Now apply that to Bitcoin. Millions of Bitcoin changed hands last year. Bitcoin absorbed hundreds of billions of dollars of sell pressure. But what if we are finally reaching the point where all those people who wanted to take profits over 100K have sold their coins? But the demand persists.

11:14ETF buyers keep pushing, sailor keeps buying, more and more institutions are entering. Banks, wealth funds, states, long-term hodlers, you name it, the demand is still there. And just as we finally saw it with Gold, when enough weak hands capitulate, there's basically nobody left to sell. And that's when the price goes parabolic. Which means, as always, there's only one thing left to do. Quit slacking and start stacking, when the price goes parabolic. Which means as always, there's only one thing left to do. Quit slacking and start stacking, when the price goes parabolic.