Bitcoin Fell Below $77,000 While Gold Held Near $4,360 an Ounce

Bitcoin opened Friday at $76,536, about 2.2 percent below Thursday's opening level and close to 6 percent lower than a week earlier. It traded between roughly $76,800 and $77,700 through the session. Gold moved the other way, reaching $4,362 an ounce on Friday afternoon, up about $47 on the day. Silver held near $64 an ounce after an early decline.

The drivers of the bitcoin decline were monetary rather than idiosyncratic. Reporting on Friday's move cited a shift in Federal Reserve expectations toward an increase at this month's meeting, Treasury yields near 4.95 percent, and three consecutive sessions of redemptions from spot exchange-traded funds. Long positions worth about $72 million were liquidated within an hour of the inflation release. Thin liquidity leaves price discovery unusually sensitive to the policy outlook.

That pattern is the opposite of what the digital-gold argument predicts. Both a Gulf war that has closed a major shipping strait and an inflation reading of 3.4 percent are exactly the conditions under which a scarce monetary asset should attract money. Gold and silver did attract it. Bitcoin behaved as a high-beta risk asset whose marginal buyer is leveraged and whose marginal seller is an exchange-traded fund holder reducing exposure because cash now yields more.

The Economic Times published a survey of the case for bitcoin against ether over the coming year, arguing that expectations about artificial intelligence and growth now shape digital-asset pricing as much as monetary arguments do. That framing is itself evidence of the change. When the growth and liquidity narrative drives the asset, the hedge property weakens.