Bitcoin News Today: Gold's Safe-Haven Surge Exposes Bitcoin's Split Identity

Gold reached a record high of $3,485 per ounce on Monday, driven by market sentiment influenced by U.S. President Donald Trump’s comments on inflation, which emphasized a "deflationary" outlook for the U.S. economy. The surge in gold prices followed a 1% increase driven by heightened demand for safe-havens amid ongoing uncertainty surrounding monetary policy and broader economic conditions [1]. Meanwhile, Bitcoin’s recent performance diverged from gold, reaching a two-month low of $107,290 on Coinbase, marking a 13% decline from its mid-August peak [1].

The contrasting movements highlight Bitcoin’s so-called “split personality,” as noted by IG market analyst Tony Sycamore, who explained that Bitcoin can function as both a store of value and a risk asset depending on market conditions. This dual nature has led to a recent breakdown in the historical correlation between Bitcoin and gold, which had been strong over the past two and a half years. Sycamore noted that while Bitcoin and gold often move in sync over the long term, short-term divergences are not uncommon [1].

Vince Yang, co-founder of Ethereum layer-2 platform zkLink, echoed this sentiment, pointing out that Bitcoin and gold have exhibited weak or even negative correlations at times this year. He attributed this divergence to gold’s traditional role as a safe-haven asset and Bitcoin’s greater sensitivity to liquidity and market risk. This dynamic suggests that the two assets may serve as balancing forces within a diversified portfolio rather than moving in tandem [1].

Despite the recent divergence, some analysts believe the correlation between Bitcoin and gold could realign if broader macroeconomic conditions shift. Sycamore speculated that if the U.S. economy experiences a period of rapid expansion and the Federal Reserve cuts interest rates in response to persistent inflation, the link between the two assets could strengthen once more, potentially driving both higher. However, the extent to which Bitcoin can participate in this scenario will depend on its ability to find a stable base from which to resume upward momentum [1].

Historical data also suggests a potential lag between gold and Bitcoin price movements. Gold reached a peak of over $2,000 in 2020 during the pandemic, followed by a Bitcoin rally the following year. Analyst Joe Consorti noted that Bitcoin tends to follow gold’s directional bias with a delay of 100–150 days. If this pattern holds, the current gold rally could set the stage for a Bitcoin upswing in the coming months, though this remains speculative and contingent on market conditions [1].

Source:

[1] Bitcoin's 'split personality' on display as gold hits new record (https://cointelegraph.com/news/bitcoin-split-personality-gold-new-record-analyst)