{"id":64,"date":"2025-10-22T17:50:12","date_gmt":"2025-10-22T17:50:12","guid":{"rendered":"http:\/\/monsoonblockchain.net\/?p=64"},"modified":"2025-10-22T17:50:12","modified_gmt":"2025-10-22T17:50:12","slug":"golds-worst-dip-in-years-wipes-2-5t-how-does-bitcoin-match-up","status":"publish","type":"post","link":"https:\/\/monsoonblockchain.net\/?p=64","title":{"rendered":"Gold\u2019s worst dip in years wipes $2.5T: How does Bitcoin match up?"},"content":{"rendered":"

Gold\u2019s worst dip in years wipes $2.5T: How does Bitcoin match up?<\/a><\/p>\n

Gold, one of the oldest and most trusted stores of value, suffered a brutal sell-off in just 24 hours, wiping out trillions of dollars in market value, more than the entire value of Bitcoin.<\/p>\n

The gold market extended Tuesday\u2019s massive correction, with $2.5 trillion being erased from its market cap on Wednesday, according<\/a> to the financial analysis publication, The Kobeissi Letter.<\/p>\n

Putting gold on track for its largest two-day decline since 2013, the 8% drop has sparked panic among investors who had turned to the metal as a hedge against inflation and market volatility after its 60% surge earlier in 2022.<\/p>\n

Although Bitcoin (BTC<\/a>) \u2014 often dubbed \u201cdigital gold\u201d for its capped supply \u2014 is known for far sharper daily corrections with double-digit percent declines, gold\u2019s latest crash underscores that even \u201csafe-haven\u201d assets aren\u2019t immune to steep sell-offs.<\/p>\n

Gold\u2019s 7% drop is rare: Here\u2019s why it crashed<\/h2>\n

The scale of the correction is highly unusual and in theory would only happen \u201conce every 240,000 trading days,\u201d Alexander Stahel, a resources investor in Switzerland, observed<\/a> in a post on X on Tuesday.<\/p>\n

\u201cGold is giving us a lesson in statistics,\u201d he said, adding that the asset has faced even bigger drawdowns since 1971, with such corrections counting 21 times.<\/p>\n

Addressing the reasons behind the dip, Stahel pointed to the growing fear of missing out (FOMO), as \u201cgold frenzy\u201d momentum built up amid investors increasingly seeking exposure to gold equity, physical gold bars and tokenized gold.<\/p>\n

Source: <\/em>Alexander Stahel<\/em><\/a><\/figcaption><\/figure>\n

\u201cFOMO caused the latest leg up. Now, profit taking and weak hands got shaken out,\u201d Stahel said, adding that statistically there are chances that \u201ccalmer days are ahead.\u201d<\/p>\n

Crypto Fear & Greed Index at lowest levels since 2022<\/h2>\n

As gold\u2019s $2.5 trillion dip surpasses Bitcoin\u2019s entire market cap of $2.2 trillion, some commentators highlighted the magnitude of the correction in comparison to the crypto market.<\/p>\n

\u201cIn terms of market cap, this decline in gold today is equal to 55% of the value of every crypto currency in existence,\u201d veteran trader Peter Brandt wrote<\/a> in an X post on Tuesday.<\/p>\n

Bitcoin, which has long been criticized for volatility as one of the key arguments against being a legitimate store of value, has also slipped<\/a> 5.2% from its intra-day high of $114,000, though daily losses were about 0.8% at the time of writing, according to Coinbase data.<\/p>\n

\"Gold,
The Crypto Fear & Greed Index. Source: Alternative.me<\/em><\/figcaption><\/figure>\n

While Bitcoin spot exchange-traded funds (ETFs) also saw<\/a> $142 million inflows yesterday, the broader crypto market momentum plunged into \u201cExtreme Fear,\u201d with the Crypto Fear & Greed Index plummeting<\/a> to levels not seen since December 2022.<\/p>\n

Related: <\/strong><\/em>Bitcoin-gold correlation increases as BTC follows gold\u2019s path to store of value<\/strong><\/em><\/a><\/p>\n

Gold\u2019s ongoing volatility came weeks after Deutsche Bank\u2019s macro strategist Marion Laboure observed a set of parallels between gold and Bitcoin<\/a>, which could potentially make the crypto asset an appealing store of value.<\/p>\n

Deutsche Bank\u2019s analysts also stressed that despite parabolically breaking new highs in dollar terms<\/a>, gold only surpassed its real-adjusted all-time highs in early October.<\/p>\n