Gold ETFs Surge to Record 4,189 Tons as Bitcoin Sees Best Month of the Year

Gold ETFs have reached a new record high of 4,189 tons after investors injected $18 billion in August, the second-best month on record. This marks a significant increase from July's 4,068 tons. The World Gold Council notes that August's inflows were driven by concerns about US debt, movements in the dollar, and increased institutional purchases.

Meanwhile, Bitcoin ETFs in the US attracted $3.52 billion in August, their best month of the year. While gold remains far ahead in size, Bitcoin's growth is accelerating from a smaller base. Gold's price appreciation in August contributed to a 16% jump in assets managed by ETFs to $615 billion.

The People's Bank of China added 20.2 tons of gold to its reserves in August, its largest monthly purchase since October 2023. Chinese demand for gold is not uniform, however, with withdrawals from the Shanghai Gold Exchange falling 22% in August compared to July.

Investors seem to be seeking both gold and Bitcoin as safe-haven assets, rather than transferring money from one to the other. Bitcoin's institutional demand is mainly driven by ETFs, companies, and asset managers, rather than central banks like those that regularly purchase gold.