For many years, gold has always been perceived as something reliable, as an asset worth putting your capital into. Whenever there was geopolitical tension, inflation, wars, or pandemics around the world, it was almost always possible to see gold prices rising. However, as recent market reports show, the era when gold was viewed as a safe haven for investors and people seeking protection may be coming to an end. I would even go as far as to say that gold, as well as gold mining companies, are increasingly starting to resemble scam cryptocurrencies, coins, and scam stocks — with their rapid surges, sharp crashes, and disregard for fundamental market principles.

Let’s take wars or military conflicts as an example. Traditionally, during such “campaigns,” gold would automatically increase in value. However, during the latest escalation around Iran, assets in the sector began reacting in the exact opposite way.

When there was a threat of new strikes and a tougher US policy, gold mining stocks fell by almost 4–5%. But when news about peace negotiations appeared, the sector immediately recovered, rising by 3–5%. An interesting fact is that the five largest daily declines in the gold market occurred precisely during periods of the highest geopolitical tensions.

How did gold become a speculative instrument?

Analysts from Bloomberg and executives of American investment funds (such as Tuttle Capital) identify two main factors explaining why gold has turned into a tool for speculation:

1) Instead of serving as protection against inflation, gold has transformed into an instrument for short-term speculation based on decisions made by the US Federal Reserve. Investors fear rising interest rates (because gold does not generate interest income) and aggressively sell the asset at the first signs of a more restrictive Fed policy.

2) The influx of speculative investors who changed the market. When gold showed an abnormal increase of +65% in 2025, while mining stocks surged by 155%, a large number of retail traders and speculators entered the market. They trade chaotically, driven by emotions and news, and have essentially transformed what was once considered a serious asset into something resembling scam tokens.

How the price of gold has changed over the last 5 years:

“The entire stock market now resembles a raid of hamster traders. Fundamental factors practically no longer work. Everything is driven by news and market manipulation, which completely contradicts the traditional logic of investors moving into safe-haven assets,” says Matt Tuttle, Chief Investment Officer of Tuttle Capital Management.

Because of this volatility, large investment funds (such as Tuttle Capital and Old West) have started actively selling gold and reducing their exposure to the sector. These financial giants are simply looking for new alternatives, with two areas standing out the most:

1) Energy and utilities (investors are looking for protection in these sectors).

2) Copper producers (a relatively undervalued asset among ordinary and retail investors, which showed +45% growth in liquidity over the year) and natural gas companies — resources that are critically important for powering AI data centers.

How the price of copper has changed over the last year:

At the moment, gold has temporarily stopped functioning as a safe-haven asset. It has become a high-risk asset where, just like in the cryptocurrency sector, emotions and news dominate market movements. For long-term investors, this is a signal to remain cautious, while for speculative investors and traders, it has essentially become a new playground where they can profit from these market swings.

Thank you so much for reading this article! I hope you found it insightful.