Gold and Crypto Assets Shunned During Periods of Rising Interest Rates
“Gold and Cryptocurrency Diverge”
The September 30, 2026, evening edition of the Nikkei features an article titled “Gold and Cryptocurrency Diverge.”
“The benchmark 10-year U.S. Treasury yield briefly reached 5.29%, its highest level in about 19 years since June 2007. Gold and crypto assets (cryptocurrencies) tend to be shunned during periods of rising interest rates. Because neither asset generates interest, they are prone to capital outflows.
However, the fortunes of these two assets are currently beginning to diverge sharply.”
(Omitted)
“While Bitcoin maintains an upward trend, gold has stalled in just one week. The price movements of the two have begun to decouple. Even as stateless currencies, why are they being evaluated so differently? (Omitted) Gold prices are facing increased downward pressure as high interest rates become a burden.”
(Omitted)
“According to the analysis platform Defilama, weekly net inflows into Bitcoin-related exchange-traded funds (ETFs) reached approximately $2.4 billion for the week ending September 27, the highest level since October 2025. Bitcoin prices have risen by about 20% since August 19, and according to the data analysis site CoinGlass, prices rose by more than 40% in the July-September quarter, the highest level since the October-December quarter of 2024. (Omitted)”
In the June 15, 2026, T-Model column titled “What Does the 23% Plunge in Gold Prices from Their All-Time High Suggest?”,
“Gold prices have plunged 23% from the all-time high of $5,262 reached on January 29 of this year. As mentioned in the opening article, tensions from the Iran war and confirmation of a strong U.S. labor market the weekend before last have strengthened expectations that the Federal Reserve (FRB) will raise interest rates, leading to further selling of gold, which pays no interest.”
“However, the decline in gold is very similar to the period when the market fell into chaos during the 2008 ‘Lehman Shock.’ At that time, after gold prices briefly rose to the $900 range in March 2008, they plunged about 30% to the $600 range in October. Lehman Brothers filed for bankruptcy on September 15, but gold was also sold off after October, when the decline in stock prices accelerated.
Gold was sold to secure cash needed to cover losses and meet margin calls due to the financial crisis occurring beneath the surface since March 2008. In other words, there was a move to sell gold to secure liquidity, and in fact, the ‘Dollar Index’ surged 21% from a low of 73.6 in February 2008 to a high of 89.2 in November. Currently, it has returned to the 100 level it reached after the start of the Iran war, hitting a high of 100.3 last week on June 11, and remains high.”
“However, what is different from that time is that stock prices are still rising, but ‘Bitcoin,’ which tends to lead the stock market, has crashed about 50% from the $120,000 range in September 2025 to under $60,000 in June 2026.
Incidentally, after the ‘Lehman Shock’ in September 2008, NY futures prices bottomed out in the $600 range in October 2008 and then surged 2.8 times to the then-all-time high of the $1,900 range in July 2011.
If gold is falling for the same reason as in 2008, it will surge after the crisis beneath the surface comes to the surface, but what will happen?
‘Bitcoin’ will likely bottom out around this September, and we will likely know the answer then,” it pointed out.
The important point in the opening article is: “Gold and crypto assets (cryptocurrencies) tend to be shunned during periods of rising interest rates.
Both assets do not generate interest, so they are prone to capital outflows.
However, the fortunes of these two assets are currently beginning to diverge sharply. While Bitcoin maintains an upward trend, gold has stalled in just one week.
The price movements of the two have begun to decouple. Even as stateless currencies, why are they being evaluated so differently?”
Data that could be called the answer was published last week.
“Global gold ETF holdings have reached approximately 100 million ounces, approaching their highest level in at least nine months. Gold holdings have increased by more than 4 million ounces since the July low, far exceeding the decline from April to July.
Recently, there have been inflows into gold ETFs for eight consecutive days, the longest streak since October 2025.
Meanwhile, gold prices had been moving almost in tandem with gold ETF holdings until mid-August of this year.
Therefore, if gold prices catch up to the recent increase in holdings, they could exceed $5,000 in the coming months.
Investors are pouring money into gold funds at an accelerated pace,” it is reported.
In other words, although demand for gold remains strong, it is being sold for some reason, and the possibility that the scenario T-Model has pointed out for some time—that ‘gold was sold to secure cash needed to cover losses and meet margin calls due to the financial crisis occurring beneath the surface since March 2008’—is being reproduced…
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Tsukazawa.com Weekly Column
Gold and Crypto Assets Shunned During Periods of Rising Interest Rates
https://tsukazawa.com/
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