Bitcoin, gold, and other precious metals are back in the spotlight. Investors are increasingly leaving the dollar and buying what is considered reliable. Since the beginning of the year, BTC has broken a new high — over $125,000. Gold has also risen and is close to $4,000 per ounce.
At the same time, the US stock market is also growing. The S&P 500 index has gained over 40% in the past six months. Such growth alongside gold is unusual. According to Kobeissi Letter, the correlation coefficient between these assets has reached 0.91 — a record. Usually, they move in opposite directions.
Analysts believe the market has started to react to changes in economic policy. The Fed is lowering rates, and the dollar is weakening. Since the start of the year, it has already lost more than 10%. Over the past two decades, its purchasing power has dropped by 40%.
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Add to this the US government shutdown and the downward revision of employment statistics. All this undermines trust in traditional structures. And against this uncertainty, bitcoin is increasingly seen as an alternative.
According to Kobeissi:
“We are now witnessing a massive capital flow into assets. Amid rising inflation and a weakening labor market, the Fed is lowering rates. The dollar has already fallen by more than 10% since the beginning of the year and is heading for its worst result since 1973. Since 2000, its purchasing power has dropped by 40%.”
The new BTC high is driven by macroeconomic factors
According to Fabian Dori, investment director at Swiss digital bank Sygnum, bitcoin’s rise to a new all-time high is largely due to the macroeconomic situation, including the recent US government shutdown.
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Since the shutdown began on Wednesday, the work of government regulators and bureaucratic structures has either completely stopped or switched to minimal funding and reduced staff.
Bitcoin is breaking records and is in a bull market phase. Source: TradingView
Political instability caused by the government shutdown has once again drawn investors’ attention to bitcoin as a store of value, Dori noted. According to him, trust in traditional institutions is weakening, and this plays into BTC ‘s hands.
