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Central Banks Go for Gold as Bitcoin Rallies in 2025
Key Takeaways
- Central banks have raised gold reserves to 24%, the highest since the 1990s, which doubles the buying pace seen between 2011 and 2021;
- Deutsche Bank notes similarities between gold and Bitcoin, both rising as alternatives to fiat currencies during uncertain times;
- Gold’s delayed inflation-adjusted peak was due to decades of sell-offs, institutional limits, and the rise of paper-based money systems.
According to an October 9 report from Deutsche Bank, central banks around the world have steadily increased their gold holdings.
This trend is drawing comparisons to the rise of Bitcoin
During the second quarter of the year, gold made up 24% of central bank reserves, a level not seen since the 1990s. Deutsche Bank analysts noted that the current pace of gold buying is around twice the yearly average recorded between 2011 and 2021.
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The report also suggested that both gold and Bitcoin appear to be gaining ground for similar reasons. In times of uncertainty, both assets are being turned to as alternatives to traditional currencies.
Bitcoin's surge in 2025 seems to echo the renewed interest in gold. Deutsche Bank’s team sees common patterns between Bitcoin and gold: a preference for limited-supply assets, a hedge against inflation, and increasing demand from institutions looking to spread risk across different asset classes.
The report also pointed to the reasons gold took so long to reach its inflation-adjusted peak.
Several factors contributed to the delay, including years of gold sales by central banks, restrictions on institutional gold ownership, and the growth of a monetary system based on paper currencies.
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