Despite the rebound at the end of the first quarter, the broader quarter was still bearish for the market.
From a technical point of view, Bitcoin [BTC] Although the month of March rose by 1.5%, the first quarter ultimately fell by more than 22%.
Similarly, the BTC to gold ratio briefly recovered over 17% during the month but still ended the first quarter up over 28%, extending the 31% decline in the fourth quarter.
In other words, Bitcoin’s relative strength against gold continued to weaken.
Meanwhile, tokenized gold (XAUT) attracted notable capital flows. As the chart below shows, spot trading volume in tokenized gold reached $90.7 billion in the first quarter of 2026, already surpassing the $84.6 billion for all of 2025.
Essentially, demand for tokenized gold continued to increase even as Bitcoin underperformed.
When you compare this to the decline in the BTC/gold ratio in the first quarter, the setup becomes more meaningful.
While markets briefly saw the 17% rebound in the ratio as a sign that Bitcoin could reaffirm its “digital gold” narrative, March’s 1.5% gain was nowhere near enough to match the volume of activity in XAUT.
Instead, the difference highlights a clear flow preference: even as traditional gold experienced periods of weakness, demand continued to shift toward token exposure, especially in an environment shaped by uncertainty.
This obviously raises an important question: With macro FUD back in the picture, is Bitcoin’s Q2 rally now in jeopardy?
Macro FUD Returns as Tokenized Gold Gains Increase Bitcoin Q2 Risk
So far, the second quarter has been largely bullish across the board, with markets returning to a risky mood.
From a technical perspective, Bitcoin’s May gain of 6% comes with a drop in oil prices of more than 7% after peaking near $120 per barrel earlier this month.
Typically, falling oil prices are seen as supportive of risky investments as they help reduce inflationary pressures and improve overall liquidity conditions.
However, that trend appears to be short-lived. As highlighted in US President Donald Trump’s latest comments on Iran’s response to the US 14-point peace proposal, geopolitical uncertainty quickly came back into focus.
The result: U.S. oil prices rose nearly 5% after President Trump said he “doesn’t like” Iran’s response. Meanwhile, Bitcoin responded with a 1.5% pullback.
Naturally, this brings the flow dynamics around tokenized gold back into focus.
With the BTC/XAU ratio already up 5% this month, flows still favor Bitcoin over traditional gold, continuing its 12.6% price move in April. That said, with macro FUD creeping back in, the setup leaves the door open for capital to flow back in tokenized gold when the sense of risk increases.
If that rotation picks up, the risk that Bitcoin will reflect a Q1-style correction in Q2 starts to increase as investors move to safety via XAUT rather than remain exposed to BTC beta or traditional gold, making this a major trend for the remainder of the Q2 cycle.
Final summary
- In the first quarter, Bitcoin fell while tokenized gold saw strong inflows, highlighting a clear shift in demand.
- If the macro FUD returns in the second quarter, capital could turn back into tokenized gold and put pressure on Bitcoin’s momentum.