Over the past six months, retail investors have been the mainstay of gold fund purchases, helping extend the bullion’s rally even as some institutional investors have begun to retreat.
At the same time, new inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) indicate that some on Wall Street are restructuring their crypto exposure through regulated ETF channels, creating a rift in how investors are responding to the same backdrop of war, inflationary pressures, and shifting interest rate expectations.
This divergence provides a clearer picture of investor behavior than either market in isolation. Fundamentally, households have relied on gold as a traditional store of value, but pro-capitalists have shown a renewed appetite for Bitcoin purchases following a weak start to the year.
The result is a market where gold and Bitcoin operate not as simple rivals in the same defensive trade, but as separate expressions of different risk appetites.
Retail industry takes the lead in gold accumulation
The Bank for International Settlements explained the change in unusually direct terms in its quarterly review in March.
In a section on precious metals declines in late January and February, BIS said capital flow data shows that retail investors are the main source of inflows into gold and silver funds, while institutional investors “maintain stable positions or even reduce exposure.”
According to a graph accompanying the analysis, cumulative retail inflows into gold funds will increase from about $20 billion in the second half of 2025 to about $60 billion by the first quarter of 2026, while institutional inflows remained roughly flat and then turned negative.
BIS linked this move to a broader bull market that will extend into 2025 and early 2026. Gold and silver soared before reversing in late January and February, but BIS said the volatility was amplified by retail participation through ETFs, daily rebalancing through leveraged products, and margin-driven selling.
Silver will double in 2025, rising more than 50% in January alone, but falling about 30% in a single day in late January. Gold followed the same pattern with smaller movements.
The flow of funds diagram helps explain how gold continued to attract capital even as its price became harder to track.
Physically backed gold ETFs saw a record $19 billion in inflows in January, and added another $5.3 billion in February, marking the ninth consecutive month of inflows, according to World Gold Council data.
Total holdings increased to 4,171 tons in February, and assets under management reached a record high of $701 billion.
While these totals show demand remains broad-based, the BIS breakdown suggests retail investors were making more of the additional purchases.
Bidding by institutional investors begins to soften
What changed in March was not the long-term case for gold, but the willingness of some large investors to keep adding at the same pace.
Earlier this month, investors withdrew more than $4 billion from GLD, the largest gold-backed ETF. Notably, this was the largest weekly outflow in its 20 years of existence.
By a week later, spot gold prices had fallen rapidly to around $4,611 an ounce, the lowest since early February.
The move extended the session’s losing streak to seven, as rising oil prices and inflation concerns fueled expectations for monetary policy tightening, according to data from goldprice.org.
Since gold doesn’t produce anything, rising interest rates over time have always been a problem for bullion, but the recent sell-off has brought that old relationship back to being a major factor.
Reuters reported that Commerzbank analysts pointed to more restrained policy expectations as a key reason why gold prices are under pressure, while TD Securities said the past year’s “subsidence trading” has led to greater institutional investor positioning, weakening its trading fundamentals.
In other words, the buyers of gold have changed just as it has become harder to keep the macro picture in line.
Still, institutional setbacks should not be exaggerated.
The World Gold Council said North America added $7 billion to gold ETFs in January and another $4.7 billion in February, both part of sustained capital inflows related to geopolitical risks and demand for defense assets. Europe was the weakest in February, with $1.8 billion in outflows, much of it related to redemptions after a decline in late January.
This means that financial institutions have reduced their exposure to precious metals to the bare minimum, but have not completely abandoned them.
Bitcoin withdraws new funds
While institutional bidding for gold is starting to lose certainty, Bitcoin has once again started attracting capital through the market’s major institutional access points.
U.S. spot Bitcoin ETFs absorbed about $1.16 billion in net inflows from March 9 to March 17, according to data compiled by Pharcyde Investors. Notably, this was the strongest continuous inflow since October last year.
This streak includes daily net increases of $246.9 million on March 10, $180.4 million on March 13, and $199.4 million on both March 16 and March 17.
However, while its rise was briefly halted on March 18th with an outflow of $163.5 million, the direction of its flow was already established, with BTC price reaching a high of over $75,000 during a continuous rally.
While these ETF flows are not proof of institutional acceptance of cryptocurrencies, they are the clearest evidence that professional funds are starting to return to Bitcoin after months of caution.
This is further supported by Bitwise data, which shows that the latest institutional demand for Bitcoin extends beyond ETF inflows.
Andre Dragos, head of research at Bitwise Europe, said in a post on X that institutional demand has accelerated to its highest level since October 2025.
According to his one-month tally, Bitcoin ETP added 34,400 BTC, and financial companies added 46,800 BTC, for a total of 81,200 BTC, including 46,400 BTC from Strategy alone.
For a monthly new supply of approximately 13,300 BTC, this means that financial institutions purchased approximately six times as many Bitcoins as miners produced during the same period.
Meanwhile, Coinbase’s latest institutional survey points out the institution’s strong belief in top cryptocurrencies.
In a January survey of 351 institutional decision makers conducted by EY Parthenon, 74% of respondents said they expected crypto prices to rise in the next 12 months, and 73% said they planned to increase their allocation to digital assets in 2026.
The report said the proportion of companies allocating more than 5% of their assets under management to digital assets is expected to rise from 18% to 29% by the end of 2026.
These numbers suggest that Wall Street’s return to Bitcoin is no longer only visible through an ETF wrapper. This is also reflected in survey data showing corporate financial accumulation and larger planned allocations.
What does this change mean for gold and BTC?
The split in flows suggests that gold and Bitcoin are attracting different types of buyers across different parts of the same macro trade.
Gold remains the first choice for retail investors seeking a store of value during periods of war, inflation, and interest rate uncertainty. Its long history, abundant liquidity, and low day-to-day volatility make it attractive to households and fund buyers looking for protection without the price fluctuations common in cryptocurrency markets.
In contrast, Bitcoin is regaining ground with institutions willing to treat it as a rare and liquid asset with greater upside potential and higher risk.
Research data showing recent increases in ETP demand, accumulation in treasury companies, and expansion of planned allocations suggests that professional investors are becoming more comfortable adding exposure as supply conditions tighten and access improves through regulated products.
For the market, this means that gold and Bitcoin no longer compete in a simple zero-sum fashion.
Gold could continue to attract defensive retail flows even if institutional funding slows, while Bitcoin could benefit from corporate purchases and portfolio reallocations, even if it remains more sensitive to policy signals and liquidity conditions.
In the short term, gold appears to be positioned to maintain its role as a hedge, while Bitcoin is increasingly traded as an institutional scarcity asset.
(Tag translation) Bitcoin
