Bitcoin and Gold Both Bleed Funds – Is a Market Meltdown Coming in September?

But August broke that pattern: both assets faced significant outflows at the same time, highlighting how uncertainty in U.S. monetary policy is unsettling markets across the board.

Rare Parallel Outflows

Instead of the usual see-saw effect, Bitcoin ETFs saw nearly $2 billion in withdrawals during the final stretch of August, marking six straight days of redemptions. Gold funds, which typically soak up those flows, also lost ground, with almost half a billion dollars exiting in just one week.

Later in the month, however, both asset classes saw a brief recovery, with Bitcoin ETFs logging a four-day inflow streak and gold funds also bouncing back. Still, the unusual alignment suggests investors are pulling back altogether rather than rotating between the two.

Macro Clouds Dominate

The synchronized exits come against a backdrop of mixed economic signals: inflation remains stubbornly high, while labor market data points to a slowdown. This leaves the Federal Reserve in an uncomfortable position, torn between holding rates higher for longer or cutting to support growth.

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Until the Fed’s direction is clear, investors appear unwilling to take heavy bets on either speculative risk assets like Bitcoin or traditional safe havens like gold. Instead, many are choosing to sit in cash or move toward higher-yielding instruments.

Outlook Ahead

Both Bitcoin and gold have long been seen as hedges against instability, but this month’s unusual correlation shows that when policy signals are murky, even hedges lose their shine. The next Fed meeting is likely to decide whether this pause in flows turns into a deeper trend or a temporary detour.

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