Gold Surpasses 4,000 Dollars, Bitcoin Weakens.

Gold and Bitcoin Market Developments

October 8 - Gold surpassed $4,000 per ounce, achieving a historic milestone. During this time, Bitcoin (BTC) experienced a decline, dropping by 1.25%. The broader cryptocurrency market, as measured by the CoinDesk 20 (CD20) index, saw a 3% value loss. This drop comes after a 7.7% increase in the cryptocurrency market over the past week, resulting from profit-taking.

This fluctuation coincided with the U.S. Dollar Index (DXY) reaching its highest level in two months. Seen as a safe haven, gold has increased by more than 50% this year. According to an ING report, investments in gold-backed exchange-traded funds (ETFs) have accelerated, reaching their highest levels since the end of 2022.

Investor Concerns

Investors are seeking protection from rising uncertainties such as increasing political risks in France and tensions in Japan's fiscal policies. Additionally, the U.S. government's ongoing shutdown, now in its second week, has delayed the release of important economic data, heightening concerns about the financial outlook.

Although Bitcoin is typically viewed as a hedge during periods of uncertainty, rising U.S. Dollar values and short-term significant investors transferring their Bitcoins to exchanges and exchange-like platforms indicate profit-taking strategies. Furthermore, rising government bond yields in Japan, which have reached their 17-year peak, are putting pressure on Bitcoin. The 10-year bond yield hit 1.70% as the new Prime Minister Sanae Takaichi's new spending program is pricing in fiscal risks.

Future Expectations

According to Goldman Sachs, the pressure from Japanese bond yields may have ripple effects on global bonds. High bond yields tend to tighten financial conditions, potentially reducing investors' appetite for riskier assets. However, institutional interest in Bitcoin remains strong. Over the past week, listed spot ETFs in the United States saw purchases exceeding $3 billion, with total net inflows surpassing $60 billion. An additional $2 billion has flowed in this week.

Market analyst Linh Tran noted that Bitcoin's fundamental outlook remains positive in the short term, supported by expectations of easing monetary policies, continued ETF inflows, and ongoing demand for safe havens. Should the Federal Reserve signal rate cuts in upcoming meetings, Bitcoin may have the potential to rise to new price levels.

Overview of the Week's Calendar

This week, some important events include:

• October 8, 1:00 PM: Hedera (HBAR) mainnet upgrade, transitioning to version 0.66.
• October 8, 9:30 AM: Federal Reserve Board Member Michael S. Barr's speech at the 2025 Community Banking Research Conference in St. Louis.
• October 8, 2:00 PM: Release of the minutes from the Federal Reserve's September 16-17 FOMC meeting.