Why Are Gold, U.S. Stocks, and Bitcoin Falling Together? The Crowded "De-dollarization" Trade Faces a Reversal

In 2025, the US dollar index declined nearly 9.5% for the entire year, marking the largest annual drop since 2017. By early 2026, the market experienced intense volatility: the market capitalization of the precious metals sector fluctuated by as much as $10 trillion within a single trading day, gold plummeted over 12% in one day, and silver’s decline once exceeded 30%.

Meanwhile, according to Gate market data, Bitcoin’s price has changed by -11.16% over the past 7 days. This synchronized decline has puzzled investors: has the logic of “de-dollarization” failed?

Market Anomaly: The Behind-the-Scenes of Synchronized Declines

Recently, the global markets have presented a confusing picture. Traditional safe-haven assets like gold, the so-called “digital gold” Bitcoin, and US tech stocks have experienced rare synchronized declines.

According to the latest Gate data, Bitcoin (BTC) is currently trading at $64,994.1, down 11.16% over 7 days. At the same time, traditional safe-haven asset gold is under pressure, currently priced at $4,824.09/oz, down 2.05% in 24 hours.

This synchronized decline reflects a structural change in the market: the traditional boundaries of mainstream asset classes are becoming blurred.

Narrative Deconstruction: The Three Core Contradictions of “De-dollarization” Logic

The highly unified “de-dollarization” narrative is facing reality checks, mainly reflected in three core contradictions.

The weakening of the dollar is not a structural collapse. The dollar’s decline in 2025 was mainly driven by a series of specific policy shocks, such as the “parity tariffs” announced in April, whose impacts have been gradually digested by the market. Once these short-term shocks are absorbed, the dollar’s fundamental advantages will re-emerge. The US’s interest rate structure still holds an advantage. The current federal funds rate range is 3.50%–3.75%, significantly higher than the European Central Bank’s 2%, the Bank of Japan’s 0.75%, and the Swiss National Bank’s 0%. This interest rate differential continues to generate demand for the dollar through carry trades and international asset allocation.

Perception divergence on safe-haven attributes. Gold and Bitcoin hedge different types of risks. Gold, as a traditional safe-haven asset, mainly addresses short-term event risks such as geopolitical conflicts or tariff wars. Bitcoin, on the other hand, more often hedges long-term systemic risks like monetary over-issuance, fiscal deficits, and reserve system instability. This difference explains why, during short-term risk events, gold is often bought while Bitcoin may be sold off.

Market structure appears highly crowded. “De-dollarization” trades have become one of the most crowded macro bets in 2026. When everyone is on the same side of the trade, the market becomes extremely fragile, and any slight directional change can trigger a chain of liquidations. This extreme positioning itself poses risks beyond fundamentals.

Correlation Evolution: The Complex Relationship Between Bitcoin, Gold, and Stocks

Correlations among assets are undergoing subtle yet significant changes, challenging traditional investment classification frameworks.

Reduced correlation with traditional assets. Recent data shows that the 90-day return correlations between Bitcoin and the S&P 500 and gold have approached zero. This indicates Bitcoin is in a unique phase of “decoupling” from gold and stocks, a situation not seen since late 2021. Increased correlation with tech stocks. In contrast to the decreasing correlation with gold, Bitcoin’s correlation with tech stocks, especially the Nasdaq index, has increased. This phenomenon reflects that Bitcoin is increasingly being categorized by institutional investors as a “high-growth tech asset” rather than a traditional safe haven.

Matured volatility characteristics. Since 2021, Bitcoin’s 180-day volatility has gradually decreased, now stabilizing around 50%-60%. This level of volatility is comparable to many popular tech stocks, indicating that Bitcoin as an asset class is maturing.

Macro Mechanisms: Deep Factors Driving Market Reversal

Deep-seated drivers behind the market shift are coming into play, surpassing short-term sentiment fluctuations.

Shift in monetary policy expectations. The nomination of the Federal Reserve Chair has become a key market catalyst. The nomination of Kevin Woorh signals a potential shift in monetary policy stance. He is viewed as the most hawkish candidate, prioritizing balance sheet discipline and inflation control. Even if Woorh does not implement strict policies, the mere “hawkish threat” is enough to disrupt market expectations of “permanent easing.” This change in expectations directly challenges the highly crowded “devaluation trade.”

US economic resilience is underestimated. The US economy has maintained growth despite absorbing tariff shocks and enduring higher interest rates. In Q3 2025, real GDP growth at an annualized quarterly rate reached 4.3%, the fastest since 2023. On the fiscal front, the US also has clear advantages. The US fiscal deficit exceeds 6% of GDP, with an additional $350 billion in fiscal stimulus expected to be released before mid-2026.

Structural flaws in alternative options. Capital fleeing the dollar has not found truly attractive large-scale destinations. Europe is mired in structural difficulties, and Japan’s policy mix struggles to support a strong yen. Precious metals like gold, although once seen as “pressure valves,” experienced sharp volatility last week, exposing their fragility as safe-haven assets—highly crowded trades may be packaged as safe havens.

Cryptocurrency Positioning: Short-term Liquidity Assets and Long-term Systemic Hedges

The positioning of crypto assets is undergoing a dual transformation, which has significant implications for their future performance.

Short-term positioning: Liquidity-sensitive risk assets. When expectations of rate cuts shift, liquidity chains need to be re-priced, and risk assets are often the first affected. Bitcoin’s short-term market pricing is closer to liquidity assets, and its performance is closely related to market liquidity expectations. Bitcoin has been integrated into mainstream institutional asset pools, treated similarly to tech and growth stocks. This means that during market adjustments, Bitcoin has become part of “sellable assets,” marking its maturity as an asset class but also increasing its short-term volatility.

Long-term positioning: Off-system reserve option. Bitcoin’s long-term value proposition remains solid. Its rationale for purchase has never been “I want to hedge because of an event today,” but rather “the system has long-term issues, and Bitcoin provides an off-system reserve option.” As the global reserve system fragments and multiple regions push for de-dollarization, the narrative of Bitcoin as an “off-system” asset may actually strengthen.

The crypto market is highly interconnected internally. Currently, the crypto market exhibits a “follow the king” structure. When Bitcoin’s price drops from a high, sectors focused on DeFi, smart contracts, and computational tokens generally record declines of 20% to 25%. This lack of substantive diversification makes strategies that hedge Bitcoin risk through holding other tokens less effective.

Silver token XAGUSDT dropped 6.14% intraday on Gate, and gold token XAUTUSDT fell 1.91%. The market’s balance is subtly shifting, and capital that once bet heavily on “dollar decline” is beginning to reassess its holdings. While Bitcoin’s safe-haven narrative temporarily recedes amid short-term liquidity tightening, its long-term mission remains—providing a store of value beyond sovereignty in a world where the dollar is no longer the sole reserve currency and the reserve system is diversified.