Gold and silver reaching new highs again is being framed as a liquidity signal rather than a risk-off warning.
Bitcoin (BTC) is trading near $87,000 in late December 2025 after sliding by over 30% from its October peak above $126,000, while gold and silver continue to post record-breaking gains.
However, some analysts are arguing that this divergence is not a warning sign but a familiar setup that previously led to one of Bitcoin’s strongest rallies.
According to this view, the current pause in BTC mirrors mid-2020, when precious metals rallied first after a major market shock, before capital rotated into crypto months later with dramatic results.
Gold and Silver Lead Again as Bitcoin Consolidates
In a post shared on X on December 29, Bull Theory pointed to striking similarities between today’s market and the aftermath of the March 2020 crash.
Back then, heavy central bank liquidity flowed first into gold and silver, with gold climbing from about $1,450 to $2,075 by August 2020, while silver jumped from roughly $12 to $29. On its part, Bitcoin stayed range-bound around $9,000 to $12,000 for nearly five months before breaking to $64,800 in Q2 2021, a 440% jump in price from its August 2020 level.
Fast forward to 2025, and precious metals are once again setting the pace. Gold recently reached a new all-time high of around $4,550, while silver climbed to a new peak of its own below $84 hours ago, after an explosive final quarter. Bitcoin, by contrast, is still stuck below $90,000 as it tries to shrug off the effects of the October 10 liquidation event that wiped out more than $19 billion in leveraged positions.
Bull Theory argued that the metals moving first have historically signaled that risk assets are next, not that the cycle is ending. The analyst also noted that, unlike 2020, multiple tailwinds could line up in 2026, including continued rate cuts, renewed liquidity injections, looser bank leverage rules, clearer crypto regulation, and broader ETF access beyond Bitcoin.
You may also like:
“Last cycle, Bitcoin rallied mainly because of liquidity. This time, liquidity plus structure is coming together,” stated Bull Theory.
Price Action and What it Could Mean for 2026
At the time of writing, Bitcoin was trading at just under $90,000, up about 2% on the day but down nearly 6% year-to-date. Over the past week, price action has been tight, moving between the high $86,000s and just above $90,000, with low momentum across shorter timeframes. Monthly performance remains slightly negative, reflecting hesitation rather than panic.
This muted movement contrasts sharply with the broader metals market, where gold is up roughly 75% this year, and silver has gained more than 170%. That gap has pushed BTC-to-gold and BTC-to-silver ratios to multi-year lows, feeding the argument that Bitcoin looks undervalued on a relative basis.
If the 2020 playbook repeats and metals stall while liquidity rotates, Bull Theory estimates Bitcoin could rise more than fourfold into 2026.
“The current sideways action in BTC is not the start of the bear market, but rather a calm before the storm,” the market watcher noted.
SECRET PARTNERSHIP BONUS for CryptoPotato readers: Use this link to register and unlock $1,500 in exclusive BingX Exchange rewards (limited time offer).
