Altcoins have fallen to their weakest level on record against gold, according to analysts, as the price of the metal trades near $5,000 an ounce and highlights a widening gap between traditional safe assets and riskier digital tokens.
Market analyst Michaël van de Poppe said the relative strength index (RSI) for altcoins versus gold has dropped to around 25 on a weekly basis, a level he described as unprecedented. He noted that the only comparable period of stress was during the market crash at the start of the Covid-19 pandemic.
The sharp move reflects months of underperformance across non-major cryptocurrencies, as investors favour assets seen as more stable amid tighter liquidity and global uncertainty. While Bitcoin has held up better, smaller tokens have continued to lose ground when measured against gold’s rapid rise.
Gold-backed digital tokens have moved in the opposite direction. PAX Gold (PAXG) and Tether Gold (XAUT), which are designed to track the price of physical bullion, have risen alongside spot gold and continue to trade close to $5,000. Trading volumes and on-chain activity in these tokens have increased as some investors seek exposure to gold through blockchain-based products.
Despite that growth, tokenised gold remains a small market. Industry data estimates the total value of tokenised commodities at under $1bn, a tiny fraction of the multi-trillion-dollar global gold market. This suggests that most capital has not shifted from traditional markets into on-chain alternatives.
Analysts say altcoins have been hit by a combination of factors, including new token issuance, scheduled unlocks and reduced risk appetite. These pressures have weighed heavily on valuations, particularly outside the largest cryptocurrencies.
Some investors argue that the extreme readings point to potential value if market conditions improve. Others warn that the gap may persist unless broader liquidity returns to crypto markets. For now, the gold–altcoin divide stands as a clear signal of how sharply investor preferences have shifted.
