Digital Gold, Bitcoin and Gold Prices Surge After Trump Reignites Attention to These Top Assets

Gold and Bitcoin, commonly referred to as ‘digital gold,’ climbed higher during early Asian trading after Trump reignited attention to these top assets.

Former President Donald Trump's post on Truth Social on Sunday evening had a clear focus on the world of investing, specifically highlighting two assets that have been closely followed throughout 2024: gold and Bitcoin.

In a post that appeared around 5:30 pm ET, Trump stated, “THE GOLDEN RULE OF NEGOTIATING AND SUCCESS: HE WHO HAS THE GOLD MAKES THE RULES.”

The statement, which seemed to be an adaptation of a well-known saying, was a brief comment on the age-old link between wealth and power. However, it was sufficient to generate a noticeable reaction in the market.

After remaining relatively flat for a period, gold experienced a surge of nearly 2% within 24 hours, reaching a record high of $3,385 by early Monday.

In tandem with gold's ascent, Bitcoin also showed strength, rallying around 3% to touch $87,500. The token is now up 4.5% over the past week.

Over the weekend, Trump's attention returned to the Federal Reserve and the U.S. dollar, which he tied to rising food prices.

“They purposely make it difficult to raise interest rates quickly enough to combat inflation, and they don’t want to do it anyway, because it's good for the DEEP STATE!'” Trump said.

"The U.S. Dollar is crashing. They have no clue what to do. They've made a mess of our Economy, but they'll get it done. They'll have no choice. MAGA!" he added.

The president's weekend comment wasn't out of character, given the fact that he had made similar remarks before, suggesting that whoever holds the gold ultimately sets the terms.

In April 2023, during an interview with Real Vision, Trump said that "people start talking about Bitcoin when they lose confidence in the dollar."

However, analysts believe the real momentum for Bitcoin and gold comes from ongoing U.S.-China tensions and growing economic uncertainty, which is pushing investors toward safe-haven assets.

Commenting on the rare synchronized rally of gold and Bitcoin, The Kobeissi Letter said it signals a growing consensus among investors that uncertainty is building and the U.S. dollar may be headed lower.

"Gold has hit its 55th all-time high in 12 months, and Bitcoin is officially joining the run, now above $87,000. The narrative in both Gold and Bitcoin is aligning for the first time in years: Gold and Bitcoin are telling us that a weaker US Dollar and more uncertainty are on the way," The Kobeissi Letter stated.

The U.S. dollar index plunged to a three-year low in early Asian trading on Monday. According to ZeroHedge, the sharp decline was driven by mounting market fears following comments from National Economic Council Director Kevin Hassett.

Hassett's interview with ABC's "Good Morning America" sparked widespread concern among traders, as he indicated that President Trump is still considering ways to remove Fed Chairman Jerome Powell from his post.

The prospect of Trump exerting more direct control over monetary policy, or continuing his public attacks on the Fed, has unsettled traders. As a result, investors moved aggressively to sell the dollar, the analyst suggested.

That makes Bitcoin's behavior during this dollar collapse remarkable. Historically, when the dollar weakens, Bitcoin's price often falls as well, as both assets can be seen as competitors for investor preference.

Both assets are largely uncorrelated with major market cycles, and both assets tend to be bought by different types of investors.

However, Bitcoin did not follow the usual pattern, signaling a "regime shift."

That said, Bitcoin has not decoupled from risk-on assets just yet. As tech sector volatility rises, it will be interesting to observe how Bitcoin behaves.