Bitcoin-Gold Correlation Hits Six-Year High Amid Bond Market Volatility

The correlation between Bitcoin and gold has hit its highest level in nearly six years, according to data from Bitwise. The 90-day rolling correlation between BTC and spot gold climbed above 0.5 by August 31st, a metric that measures how closely the two assets move together.

This increase coincides with a volatile period for global bond markets, where rising long-term Treasury yields and dollar weakness have aligned Bitcoin with gold. The U.S. Treasury's decision to expand its longer-dated bond-buyback operations has also contributed to the surge in both assets.

Bitwise linked the change to the market reaction surrounding rising long-term Treasury yields and the U.S. government's decision to double the maximum size of liquidity-support buybacks. The resulting 22.4% weekly gain in Bitcoin, along with a 5% rise in gold, has pushed their three-month correlation sharply higher.

André Dragosch, Director and Head of Research Europe at Bitwise, noted that during periods when macroeconomic forces become prominent, Bitcoin has increasingly looked like 'an amplified version of gold.'