JPMorgan analysts note that global tensions and the upcoming US presidential elections are driving investors to gold and bitcoin as safe-haven assets. In the third quarter of 2024, the price of gold rose to $2700 per ounce. This surge is attributed to a 4-5% depreciation of the US dollar and a 50-80 basis point drop in US Treasury bond yields.

“Gold’s rise is influenced by the falling dollar value and a significant decline in Treasury bond yields,” analysts explained.

Reasons for Demand for Safe-Haven Assets

Other contributing factors include inflation concerns, budget deficits in major economies, and waning trust in fiat currencies. According to analysts, gold and bitcoin continue to attract attention as assets that can preserve value in times of instability.

Historical Parallels

CryptoQuant analysts draw parallels with 2008, when a decline in Treasury bond yields led to a sharp rise in gold prices from $590 to $1900 per ounce by 2011. They predict that bitcoin, often referred to as “digital gold,” may follow a similar trajectory.

“In 2008, when 13-week Treasury bill yields fell, gold skyrocketed from $590 to $1900. We are now seeing a similar trend: gold has risen from $2000 to $2700. Bitcoin may follow this pattern,” analysts suggest.

Is the decrease in the 13-week Treasury yield driving up prices?

In 2008, as the 13-week Treasury Bill Yields started to lower, gold prices soared from $590 to a peak of $1900 per ounce in 2011.

In 2024 a similar trend is occurring, with gold rising from $2000 to nearly $2700.… pic.twitter.com/zTPbeWUqeP
— CryptoQuant.com (@cryptoquant_com) October 1, 2024

Gold and Bitcoin: Differences and Forecasts

According to J.A. Maartuun from CryptoQuant, gold is already benefiting from the decline in yields and the growth of the M2 money supply, while bitcoin has not yet responded in the same way, creating a negative correlation between the two assets.

“Gold is already benefiting, while bitcoin has not yet, which creates a negative correlation,” noted Maartuun.

QCP Capital analysts previously suggested that bitcoin could temporarily drop to $55,000 due to increasing geopolitical tensions, despite its status as “digital gold.”