The Safe Haven Myth: What History and Data Say About Gold, Dollars, and Bitcoin

The Safe Haven Myth: What History and Data Say About Gold, Dollars, and Bitcoin

By Dan Runkevicius

For generations, gold has been a safe haven in uncertain times. Last week, as its price shattered records at $3,508.50 per ounce, the rush back to gold says less about its reliability and more about our collective anxiety.

In the day and age of digital disruption and rolling geopolitical crises, does any safe haven truly live up to its myth?

Research by Investors Observer has put this question to the test, analyzing how gold, the U.S. dollar, the Swiss franc, and Bitcoin actually performed during some of the most turbulent moments of the past four decades – including Operation Desert Storm, 9/11, the Ukraine War, and the back-to-back Iran-Israel escalations. The findings might surprise anyone clinging to conventional wisdom.

The Old Reliable: Gold, With Caveats

Gold’s allure is simple: it’s tangible, universally accepted, and often acts as a hedge when everything else goes haywire. The numbers back this up – on average, gold posted a nearly 9% gain in the twelve months following major conflicts, and over 14% in some historical cases. Moments like the 2024 Iran-Israel conflict saw gold soar more than 35% in a single year.

But gold’s reputation isn’t untouchable. During the 2025 Operation Rising Lion – a sudden military flare-up that resolved quickly – gold actually dropped over 3% as investors pivoted to stocks and other risk assets. This shows a change: gold no longer guarantees insulation against every disaster. Its crisis-insurance power depends on how prolonged and alarming the conflict proves to be.

The Dollar Isn’t Always King

Conventional wisdom says the American dollar should surge in a crisis. Reality is messier. Across the same set of conflicts, the U.S. Dollar Index (DXY) averaged a slight decline after one month, and even saw big drops (over 5%) after shocks like the 2024 Iran-Israel confrontation. The dollar only posted robust gains during events like the Ukraine War, thanks to rapid Fed rate hikes – not geopolitical panic.

For ordinary Americans, that’s a lesson in reading between the headlines. When central banks push rates up, the dollar can spike – but global fear alone won’t always flood the greenback with demand.

The Swiss Franc: Quiet Consistency

If a single currency has earned “safe haven” status, it’s the Swiss franc. Consistent, boring, stubbornly strong. In every recent war or crisis, the franc appreciated against the dollar – sometimes creeping modestly, sometimes delivering up to 2.9% annual gains as the dollar fell. Its secret: Swiss neutrality, a fortress financial system, and no reserve-currency baggage.

But with Switzerland’s central bank keen to cap surges, and the franc’s yield ultra-low, allocating heavily requires a steady hand and realistic expectations.

Bitcoin: Digital Wild Card

Not everyone might agree but new to the safe haven conversation is Bitcoin. The data is limited – only available for the most recent conflicts – but what we do know is: be ready for a ride. Bitcoin tanked 43% during the Ukraine War’s early months, yet soared over 32% in the year after the Iran-Israel flare-up. It even nudged higher during Operation Rising Lion as some money sought digital shelter.

Here’s the catch: Bitcoin’s crisis behavior is event-specific. Sometimes it moves with tech stocks. Other times, it behaves more like emergency cash for countries under financial restriction. Ordinary buyers should see Bitcoin less as digital gold and more as a bet on systemic change – exciting, but not consistent.

The American Playbook: Diversify, Don’t Idolize

Clearly, no single asset – gold, dollars, francs, or crypto – offers foolproof protection. Each responds differently based on the nature, severity, and duration of the crisis. For everyday Americans, resisting the urge to swing all-in on one safe asset is key.

It’s like musical chairs: Sometimes you win, and sometimes you lose. Even if there were a prognosis of gold prices reaching $4,250 by the end of 2026, you probably shouldn’t dive headfirst into buying it alone.

The smart move isn’t gold maximalism or crypto FOMO, but humility: diversify across robust, uncorrelated assets. That means some gold for crisis hedging, exposure to strong foreign currencies like the franc, and, if risk fits, a slice of Bitcoin. The world’s uncertainty, it seems, isn’t going away. But neither is the power of a balanced portfolio to weather the storm.

ABOUT THE AUTHOR

Dan Runkevicius, editor-in-chief at InvestorsObserver, is a former Wall Street publicist whose market insights have not only captured the attention of millions of retail investors but earned the respect of financial titans, including Shark Tank’s Kevin O’Leary and renowned economist John Mauldin. As the driving force behind InvestorsObserver’s market research, Runkevicius’s analysis shapes investment decisions across elite institutions – from BlackRock and Google to Harvard University and the SEC.