Bitcoin Is Trading Like Gold, Not the Nasdaq - And Right Now That's the Problem
Bitcoin (BTC) and gold have both given back much of last week's gains. The two assets had climbed in step through August as investors piled into the debasement trade.
However, Federal Reserve Chairman Kevin Warsh's Jackson Hole speech on Friday broke that run.
Debasement Trade Powered the August Rally
The rally in both assets began in the bond market. The US Treasury said it will double its buyback cap for longer-dated debt to at least $4 billion.
Investors responded by crowding into alternative assets and moving out of fiat currencies. The MSCI global gold miners index gained 43% in August, its strongest month on record.
Fund flows told the same story. Gold and Bitcoin exchange-traded funds together drew $7 billion across five trading days, a record for that window.
That combination pushed gold to its highest level since mid-May. Price hit an intra-day high of $4,697 an ounce on Tuesday.
Bitcoin rode the same trade. The asset touched $81,354 on Binance last week, its highest level in about 3 months.
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