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Gold Continues Correcting and That Might Be Good for Bitcoin
The two assets have had inverse-correlated ETF flows on four different days in the last week.
Updated May 2, 2025, 4:37 p.m. Published May 1, 2025, 7:52 p.m.
What to know:
- After surging to series of record highs in past months, gold has slipped nearly 10% in the past few sessions.
- Alongside, bitcoin has rallied to again take aim at the $100,000 level.
- One analyst noted bitcoin's performance as a better hedge than gold amid strategic asset reallocations.
What may or may not have been a blow-off top last week in the price of gold appears to have benefitted bitcoin and that trend could be set to continue.
Already among the best-performing global assets in recent months, gold's rally powered to new heights in the weeks following President Trump's Liberation Day tariffs in early April.
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The price ultimately peaked above $3,500 per ounce on April 21, with bitcoin at the time changing hands at $87,000 — roughly flat from Liberation Day, but lower by about 20% from its record high hit in January.
Since, though, gold has tumbled nearly 10% to its current price just above $3,200 per ounce. At the same time, bitcoin has rallied about 10% to a two month high of $97,000.
"I think bitcoin is a better hedge than gold against strategic asset reallocation out of the U.S.," said Standard Chartered's Geoff Kendrick.
Kendrick took note that the ETF inflow situation has flipped along with the price, with money headed into bitcoin funds surging past that headed into gold funds.
Further, said Kendrick, the last time bitcoin ETF inflows had such a wide margin over gold was the week of the U.S. presidential election. Two months later, the price of bitcoin had risen more than 40% to above $100,000.
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Japan’s Higher Rates Puts Bitcoin in the Crosshairs of a Yen Carry Unwind
A stronger yen typically coincides with de-risking across macro portfolios, and that dynamic could tighten liquidity conditions that recently helped bitcoin rebound from November’s lows.
What to know:
- The Bank of Japan is expected to raise interest rates to 0.75% at its December meeting, the highest since 1995, affecting global markets including cryptocurrencies.
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