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Bitcoin,Gold Surge As Investors Seek Safety Amid Fed Uncertainty

Coin WorldTuesday, Apr 22, 2025 5:11 am ET

1min read

QCP's latest market observation highlights a significant shift in global investment trends, with both Bitcoin and gold emerging as key beneficiaries of a flight to safety assets. The trend is driven by heightened concerns about the independence of the Federal Reserve, as market participants grapple with the potential implications of President Trump's calls for interest rate cuts and speculation about his possible exploration of legal avenues to dismiss Fed Chairman Powell.

Gold has continued its strong rally, breaking through the $3,500 per ounce level in overnight trading. This trend underscores a broader market withdrawal from US stocks, bonds, and the dollar. The price of Bitcoin has also surged, reaching its highest level since early April. This upward trend is driven by strong spot demand during the US trading session, with spot trading volume surpassing perpetual contracts. The premium on the Binance US trading platform hit a multi-month high, and Bitcoin spot ETF net inflows reached $381.3 million, indicating renewed interest from institutional investors.

Bitcoin's resilience in overnight trading further supports its decoupling narrative from the traditional market. As funds shift to safe-haven and inflation-hedging assets, Bitcoin and gold are becoming the primary beneficiaries of capital exiting dollar-denominated risk assets. The Bitcoin options market currently shows a continued bullish bias across all maturities, reflecting the growing confidence in its role as a safe-haven asset.

Meanwhile, stress is beginning to emerge in the US credit market. Investment-grade credit default insurance costs rose to a one-week high, highlighting investor unease. With the standoff between Trump and the Federal Reserve potentially escalating, the market may need to prepare for further volatility. Currently, both gold and Bitcoin are showing resilience, shining brightly in a market seeking safety assets.

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