Bitcoin Rises 23%, Strengthens Alongside Gold

Bitcoin (BTC) surged approximately 23% following the U.S. Treasury's announcement to expand its long-term bond buyback program, showing strength alongside gold. During the same period, gold rose about 5%, while the dollar and the S&P 500 index fell. The Treasury announced it would increase the size of long-term bond purchases to a minimum of $4 billion per session. The term "debasement trade" refers to the flow of funds moving into alternative assets amid concerns over the declining value of fiat currencies. According to Yahoo Finance, this week's increase in BTC is the strongest recorded in over three years. In the past six similar instances, stock declines coincided with rises in gold and BTC; however, this time, the yield on 30-year bonds rose by 1 basis point on a weekly basis. The 20-day correlation coefficient between BTC and the S&P 500 dropped from 0.43 to nearly 0, while the correlation with gold increased to over 0.5. Guzman explained that this rise was more akin to spot buying than leveraged betting, and he assessed that it is difficult to conclude that BTC's nature has changed based solely on this week's movements.

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