Bitcoin Returns to Digital Gold Correlation Amid Macroeconomic Shifts

Article by Tanay Ved

Compiled by: Saoirse, Foresight News

For a long time, the core investment thesis for Bitcoin has been as a scarce, non-sovereign monetary asset, often compared to gold. However, during certain market phases, its price behavior has resembled that of a high-beta asset, influenced by market liquidity, interest rates, and risk appetite, much like technology stocks. As the macroeconomic environment and the structure of Bitcoin investors evolve across different market cycles, the correlation dynamics between these assets continue to shift.

In this article, we will examine how the correlation between Bitcoin and gold, stocks, and the U.S. dollar shifts across market cycles; why the current high correlation between Bitcoin and gold matters; and how changes in real interest rates and recent macroeconomic data releases have influenced Bitcoin’s recent price movement.

As we explored in "Is Bitcoin Decoupling from Traditional Markets?", the correlation between Bitcoin and traditional assets shifts across market cycles. At different times, Bitcoin has moved in tandem with growth stocks and tech stocks, or behaved like a scarce store of value. What’s unique about the current market is that Bitcoin’s 90-day correlation with gold has risen to +0.56, the highest level since 2020, while its correlations with the Nasdaq 100 and the U.S. dollar have fallen back to near zero.

Data source: Talos CM market data

This divergence indicates that Bitcoin's price movement is no longer primarily driven by the risk beta of tech stocks, but rather aligns more closely with the macroeconomic factors that support gold. Recently, both Bitcoin and gold have been influenced by the same market conditions, including concerns over currency depreciation, sovereign debt, and the outlook for real yields.

Reviewing historical periods when Bitcoin and gold exhibited high correlation can help contextualize the current market:

• 2020: During the initial phase of the COVID-19 liquidity shock, Bitcoin and other risk assets fell in tandem; subsequently, the Fed’s emergency easing and fiscal interventions lowered yields, driving strong rebounds in Bitcoin and gold.
• 2023: Several regional banks in the U.S. failed, prompting the Federal Reserve to introduce emergency liquidity tools; markets once again grew concerned about financial system stress and began trading on interest rate cut expectations, benefiting both Bitcoin and gold.
• The current environment exhibits characteristics of both aforementioned periods: issues in the U.S. Treasury market have renewed market focus on the long-term purchasing power of the dollar, benefiting scarce assets. However, unlike in 2020, real yields remain high, limiting the Fed’s room for rate cuts. The rising correlation between Bitcoin and gold reflects this environment; if interest rates continue to rise, Bitcoin will still face pressure.

The rising correlation between Bitcoin and gold is driven by two opposing macro forces: the U.S. Treasury is taking action to support the long-end bond market, while markets remain focused on government debt and the dollar’s outlook; at the same time, the Fed continues to combat inflation, with interest rates and real yields remaining the key variables determining Bitcoin’s short-term movement.

• U.S. debt expansion: After the U.S. Treasury announced an increase in the scale of long-term bond repurchases to maintain market liquidity, Bitcoin and gold rose. This move lowered long-term yields and weighed on the dollar, shifting market focus back to fiscal deficits, debt issuance levels, and the long-term purchasing power of the dollar. Although bond repurchases are not direct stimulus, they have reignited the "currency depreciation trade," benefiting scarce assets like gold and Bitcoin.
• The Fed’s battle against inflation: The Fed faces opposing pressures. Strong employment data and persistent inflation concerns will keep interest rates elevated for longer, pushing up real yields; this reduces the appeal of interest-bearing assets like Bitcoin. After the September 4 non-farm payrolls data, Bitcoin declined, reflecting how stronger-than-expected employment figures rapidly increased expectations for rate hikes and pressured Bitcoin’s price.

Data sources: Talos CM market data, Kalshi

After the Jackson Hole symposium, the market's implied probability of a 25-basis-point rate hike at the September FOMC meeting rose from 29% to 51% within four hours, while Bitcoin fell 1.8% during the same period, clearly demonstrating Bitcoin's sensitivity to changes in Fed policy expectations. Bitcoin also faced selling pressure initially following the release of the August non-farm payrolls data; only after the rate hike expectations were priced in did the market absorb this shock.

Inflation and economic growth data can alter market pricing of Federal Reserve policy. Non-farm payrolls, the Consumer Price Index (CPI), and FOMC interest rate decisions all prompt the market to reassess the likelihood of further tightening or easing.

The chart below shows the average absolute price volatility of Bitcoin before and after macroeconomic events from January 2025 to September 2026, compared to regular periods without significant events, measuring only the magnitude of volatility without distinguishing between upward or downward movements.

Data source: Talos CM market data

The immediate market reaction is strongest to the employment report, with Bitcoin volatility in the 30 minutes following data release being twice that of normal periods. Core CPI data shows volatility at 1.8 times the normal level during the same period, with effects lasting longer. In contrast, the FOMC decision itself generates volatility close to baseline levels.

Data source: Talos CM market data

The non-farm payroll data released on September 4 clearly demonstrated the market's high sensitivity to employment figures. With 162,000 new jobs added in August, far exceeding the market expectation of 56,000, Bitcoin dropped 2.32% within 30 minutes of the data release, a volatility level approximately six times greater than the typical reaction to non-farm payroll events.

Macroeconomic data determines the initial direction of the market, while perpetual futures open interest, funding rates, outstanding contracts, and liquidations amplify volatility and influence the duration of price movements. Within 30 minutes after the data release on September 4, Bitcoin’s open interest decreased by 3%; the total long liquidation volume and short liquidation volume were approximately 5:1, at $119 million and $24 million respectively.

The CPI release on September 11 is the most critical forward-looking data before the September FOMC meeting. Current rate hike expectations are at a delicate balance: if CPI exceeds expectations, it will intensify pressure to raise rates; if CPI comes in weaker, it will ease pressure, benefiting Bitcoin and gold, and boosting overall risk appetite.

Bitcoin remains the core indicator of risk sentiment in the crypto market. If the Federal Reserve shifts toward a more restrictive policy path, it will likely suppress Bitcoin, altcoins, and leveraged positions; whereas a decline in inflation and a more favorable interest rate policy will boost overall market risk appetite.

But Bitcoin does not equate to the entire digital assets industry. On-chain transactions, tokenization, settlement, and prediction markets are generating independent trading volumes, fee revenues, and sources of liquidity, driven by their own growth dynamics. The continued expansion of Hyperliquid’s equities and commodities perpetual markets, the preliminary progress of the HIP-4 prediction market, the advancement of Robinhood Chain, and the sustained growth in the issuance of tokenized assets all demonstrate that the ecosystem’s development is independent of Bitcoin’s price movements.

A loose interest rate environment can enhance market liquidity and risk appetite. However, even amid macroeconomic pressures, demand for stablecoins, on-chain yields, tokenized assets, settlement services, and 24/7 trading infrastructure continues to grow. While Bitcoin may influence short-term market sentiment, the digital assets industry has the potential to thrive across varying macroeconomic cycles.