Bitcoin and gold correlation reaches six-year high as equity ties weaken
Bitcoin moves closer to gold as stock market ties fade
Bitcoin’s price movements aligned more closely with gold than at any point since 2020 during the latest bond market selloff, according to data from Bitwise. The 90-day correlation between the two assets reached a nearly six-year high at the end of August.
The shift came as longer-dated U.S. Treasury yields rose and Treasury Secretary Scott Bessent increased purchases of long-term bonds. Bitcoin gained 22.4% in a single week—its largest weekly rise since March 2024—while gold rose about 5% and U.S. stocks declined.
Key numbers
- Bitcoin’s 90-day correlation with gold hit its highest level since 2020.
- Bitcoin’s 30-day correlation with the S&P 500 fell toward zero during August.
- Bitcoin rose 22.4% in one week, its biggest weekly gain since March 2024.
- Gold gained about 5% during the same period.
- At around $78,000 in late August, 68% of bitcoin supply was in profit.
- Spot bitcoin exchange-traded funds (ETFs), which track bitcoin’s price, saw average daily inflows of $290 million at the peak of the rally.
What the data shows
Bitwise’s research found that bitcoin was negatively correlated with the U.S. Dollar Index at the end of August. This suggests that when the dollar weakens, both bitcoin and gold tend to benefit, according to André Dragosch, director of research for Bitwise in Europe.
Dragosch noted that during periods of strong macroeconomic forces, investors treat bitcoin and gold similarly as hedges against currency debasement risks. He described bitcoin as behaving like an “amplified version of gold” in these scenarios.
Analysts question whether the stock decoupling will last
Glassnode analysts observed that bitcoin’s 30-day correlation with the S&P 500 dropped toward zero during August’s rally, while U.S. stocks remained largely flat. However, they cautioned that similar decouplings during past bond selloffs have been short-lived, often marking temporary exhaustion rather than a lasting shift.
Bloomberg Senior ETF Analyst Eric Balchunas added that over the past six months, bitcoin has shown a lower correlation to U.S. stocks than gold, small-cap stocks, emerging markets, and even Treasurys. He noted that while the timeframe is limited, it challenges the idea that bitcoin moves in lockstep with tech-heavy stock indexes.
Bitcoin’s recent price action
Bitcoin’s price surpassed $80,000 in late August after a 25% monthly rally, before pulling back to around $76,000. Glassnode identified a cluster of long-term holder supply between $83,000 and $86,000, with a key support level between $62,000 and $65,000. Bitcoin was trading near $77,600 at the time of reporting.
Daily trading volume for spot bitcoin ETFs remained near $3 billion during the height of the rally.
What is still unclear
Analysts disagree on whether bitcoin’s recent decoupling from U.S. equities will persist. Glassnode suggests such moves have historically been temporary, while Bitwise highlights bitcoin’s growing similarity to gold during periods of macroeconomic stress.
