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Bitcoin-Gold Correlation Hits Six-Year High As Debasement Fears Mount
Authored by Mathew Di Salvo via BitcoinMagazine.com,
Bitcoin’s correlation with gold is at its highest in six years as investors increasingly look for ways to hedge against currency debasement.
That’s according to a new report from Bitwise, which this week pointed out that the precious metal and leading cryptocurrency are trading in lockstep because the U.S. government has “materially intervened in the macro picture.”
Bitcoin started surging last month, after the U.S. Treasury Department said it would more than double the size of its government debt repurchases. The coin had its best run in three years and third best August ever.
“The last time the bitcoin-gold correlation was that high was in 2020, following the rounds of fiscal and monetary stimulus during the Covid crisis,” Bitwise’s European Head of Research, André Dragosch, wrote.
JUST IN: Bitcoin's correlation with gold hit a six-year high, according to Bitwise 👀
"The last time it was this high was 2020, after the Covid stimulus." 🚀 pic.twitter.com/fHtQUlR9Ol
He added that bitcoin’s correlation with the stock market dropped to a one-year low, “implying some kind of decoupling between hard assets and the stock market.”
Bitcoin has been pushed as “digital gold” for years but has sometimes traded with tech stocks as a “risk-on” asset.
But the so-called debasement trade — when investors buy an asset as a way to hedge against a currency losing value — was a much-talked about investment strategy last year and appears to be back.
The reason is down to the government intervening in markets, Dragosch argued. When the Treasury said it would try to rein in long-term borrowing costs, the dollar’s value slid and sent investors flooding back to gold — and bitcoin.
The Treasury the same week also said the U.S. public debt exceeded $40 trillion for the first time. Excessive debt also undermines confidence in the dollar.
“Investors are no longer asking whether to hedge currency debasement with gold or bitcoin. They’re simply hedging with both,” the report added.
“Bitcoin spent its first fifteen years being priced as a risk asset. If this correlation trend with gold holds, the next fifteen may look very different.”
The leading cryptocurrency again rallied this week, and was recently trading for close to $81,438 after jumping nearly 6% over a 24-hour period.
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Chinese Rare-Earth Suppliers Halt US Shipments As Decoupling Fears Surge
The scenario we viewed as inevitable appears to be materializing, validating our decision to intensify coverage of the US-China decoupling theme and the Western-aligned miners positioned to supply the West if Beijing further weaponizes critical material exports, as it has throughout the Trump 2.0 era.
A Reuters report on Friday morning revealed that some Chinese rare-earth suppliers are refusing to ship material to US customers, citing fear of retaliation from Beijing.
The report continued:
A handful of Chinese suppliers have refused to ship rare earths to U.S. companies since early August when China imposed sanctions on the Responsible Business Alliance (RBA), a U.S. supply chain monitor, a separate source with direct knowledge of the situation said.
With China deploying its own trade compliance weapons, the companies were wary of punishment from Beijing for complying with the due diligence framework of the Responsible Minerals Initiative (RMI), a global mineral supply chain audit programme connected with the RBA, the source said.
Other Chinese rare earths companies had already stopped shipments to the U.S. to avoid entanglement in geopolitics in recent months, two other sources familiar with the trade said.
One cited four instances where Chinese firms declined to send material for fear it could be resold to banned users.
The exact number of blocked suppliers and shipments remains unknown, and that ambiguity is itself part of Beijing's asymmetric leverage campaign against the US.
China does not need to announce a formal trade embargo to choke critical material flows. Export controls, licensing delays, and the threat of regulatory retaliation can halt shipments to US importers almost overnight.
Really, Beijing retains a kill switch inside US defense, aerospace, semiconductor, and energy supply chains, forcing companies to scramble for substitutes only after supplies have collapsed.
That's why we've sounded the alarm in recent weeks that the decoupling theme should be top of mind for Wall Street desks, with our coverage focused on tungsten and germanium, both of which have been restricted from export to the US and are colliding with a rearmament cycle in the West.
Here's what we've reported over the last few weeks leading up to the Reuters headline this morning:
- The AI Boom Runs On Tungsten, But Global Supplies Are "Running On Empty"
- US Tungsten Scrap Export Ban Takes Effect As Global Supply Crisis Deepens
- What Happens When A Metal The West Can't Live Without Runs Short
- The West's Answer To Break China's Tungsten Stranglehold Before Historic Rearmament Cycle Ramps
- China's Tungsten Chokehold Turns Almonty Into a Critical-Metal Lifeline
- China's Record Ship Swarm Around Taiwan Sends Decoupling Alarm To Wall Street
China's tungsten export restrictions have sent European prices soaring...
Late last month, the US Commerce Department halted exports of tungsten scrap and shredded battery material in a defensive move to retain scarce supplies inside the country. The move merely shows how rapidly Washington is shifting from the free-trade status quo toward resource security as domestic supplies dwindle and an urgent race emerges across the West to procure new ex-China supplies.
The Sino-US bilateral relationship deteriorated yet again this week after Beijing derailed the G20 joint communiqué over a single phrase, "non-market," only weeks after the Trump administration sanctioned Chinese entities linked to Iran.
All eyes now turn to the Trump-Xi meeting in Washington later this month.
The decoupling theme should be top of mind on Wall Street as China restricts critical-material flows to the West. These materials are essential building blocks not only for next year's rearmament supercycle but also for AI, reindustrialization trends, efforts to power up America, and even physical AI.
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Russia Tries To Assassinate Ukraine's SBU Chief With Unprecedented Drone Attack On Kyiv HQ
The Kremlin has long previewed that its next escalation step against Ukraine would be to start attacking 'decision-making centers', or headquarters and government buildings. That moment has clearly begun and is now in an active phase, also as strikes ramp up on the key southern port of Odesa, as well as on Ukraine-linked cargo and other shipping. On Friday a Russian drone slammed into the headquarters of Ukraine’s Security Service (SBU) in central Kyiv.
The SBU is the country's top domestic security and intelligence service - somewhat akin to the FBI in America. It primarily oversees counterintelligence, counterterrorism, espionage investigations, as well as engages in some law-enforcement functions, especially concerning top level crime including among government officials. It has been the mastermind behind multiple high-level deadly and destructive attacks on Russia.
Drone targeted SBU chief at around 3:30pm local, via pravda.com.uaPresident Zelensky soon after the attack announced and confirmed that the SBU's central building on Volodymyrska Street, in the heart of iconic downtown near St. Sophia Cathedral, was struck. Flames and smoke have been seen billowing high over the high-secure central district.
"I spoke with the Head of the Security Service of Ukraine, Oleksandr Poklad. Unfortunately, a Russian drone struck the central building of the Security Service of Ukraine on Volodymyrska Street in Kyiv, across from St. Sophia Cathedral," Zelensky said.
"The drone was aimed directly at the office of the Head of the Security Service in that building," he added. Zelensky has ordered his military to mount a "tangible response and, where possible, one that mirrors this strike, to the Russians once everything is ready. Our military will support this response."
If accurate, this sends an alarming and resounding message - that not only is Moscow now willing to directly target top headquarters buildings, but that it's ready to assassinate intelligence directors.
President Zelensky said the drone had precisely targeted the office of the head of the SBU service, Oleksandr Poklad, but he had survived the attack —The Times
Big smoke cloud in drone strike aftermath targeting security HQ. ZUMA Press Wire/ShutterstockEuropean media reports of the immediate aftermath, "Zelenskyy said emergency services were attending the scene. There was no immediate information on casualties."
A large explosion was widely heard among bystanders during a mid-afternoon air raid siren in the capital city, after which Mayor Vitali Klitschko initially reported a fire and said emergency crews were headed to the scene. Several drones had been inbound during the attack incident.
According to some of the latest reporting via CNN:
The daytime strike - the first time the SBU building has been hit in the four-and-a-half year conflict - came after days of near continuous aerial assaults by Russia on the Ukrainian capital.
Authorities said 12 people were injured in the attack and that emergency services were at the scene.
⚡️ BREAKING: Attempted assassination of the head of Ukraine’s intelligence service
Russian Shahed drone strikes the Security Service of Ukraine (SBU) building in Kyiv.
President Zelenskyy said the following:
“The drone was directed straight at the office of the head of the SBU… pic.twitter.com/DRax4RI0Kb
This comes after more than a week of consecutive nightly drone and missile attacks on the capital, as Russia indicates it is 'repaying' Ukraine for its own constant long-range drone attacks which have wreaked havoc on oil refineries and industrial sites this summer.
"At least 53 people have been killed and 134 injured in Kyiv city and the wider Kyiv region since the start of these near non-stop attacks last month," CNN also notes.
Unprecedented: Downtown SBU headquarters on fire...
A Russian drone hit Ukraine's SBU headquarters in Kyiv, Zelensky says. pic.twitter.com/ZevaXpLbEV
— Open Source Intel (@Osint613) September 4, 2026This even could serve as the catalyst that gets Zelensky's Western backers to rush more anti-air missiles and systems - such as the Patriot - to Ukraine. "It is rare for government buildings in central Kyiv to be reached by Russian strikes, especially in broad daylight," The Guardian underscores. "The explosion from the hit on the SBU building could be heard several from several blocks away."
One thing is clear: the gloves are indeed coming off. And just as Trump may be trying to de-escalate the Iran war ahead of November midterms in the US, the Russia-Ukraine war just massively escalated past a likely point of no return.
Tyler Durden Fri, 09/04/2026 - 12:15