Now gold has also started to get hit along with Bitcoin
In the past, people thought
Bitcoin was highly volatile
and gold was the good safe-haven asset 💰
But it turns out gold can also drop this sharply in a single day 📉
It seems that when the market really lacks money
safe-haven assets may not necessarily find buyers
Gold was above $4100 before
now it has directly fallen below $4000
hitting a low of $3928 📉
But here is a very practical problem
Many people misunderstand safe-haven assets
as assets that only go up and never down
But that's completely not the case
Whether gold can be a safe haven
depends on what risk the market is actually avoiding
If worried about currency devaluation
or geopolitical conflicts
gold might be sought after
But if the US dollar strengthens
and US Treasury real yields keep rising
gold might actually come under pressure
After all, gold itself does not generate interest
holding it has an opportunity cost
What's more interesting is
when the market truly experiences liquidity tightness
investors might even have to sell gold
Institutions need to meet margin calls
funds face redemptions
someone has to sell assets to get cash
At this time, what is sold is not necessarily the worst asset
it might actually be the most liquid asset
$BTC
Disclaimer: OKX Orbit content is provided for informational purposes only. Learn more
