Gold, Bitcoin ETFs Pull In $7 Billion in Five Days as US Fiscal Fears Fuel Scarce-Asset Buying

Investors are buying gold and Bitcoin in tandem as concerns mount over US fiscal health and the dollar’s value.

Data compiled by Bloomberg on August 26 show gold- and Bitcoin-related exchange-traded funds drew a combined $7 billion over the past five trading days. During that period, State Street’s SPDR Gold Shares (GLD) took in about $3.4 billion, while BlackRock’s spot-Bitcoin ETF, IBIT, attracted $1.5 billion. Both ranked among the top 10 US ETFs by weekly inflows.

Those parallel inflows reflect growing unease over US fiscal policy and the Treasury market. After Treasury Secretary Scott Bessent said he would at least double the scale of long-term Treasury buybacks, long-dated Treasury yields and the dollar fell, while gold and Bitcoin climbed.

The move has revived the so-called debasement trade. The idea is that as government debt and fiscal burdens increase, demand rises for assets with constrained supply. Gold is benefiting from its role as a traditional haven, while Bitcoin is drawing support from its fixed maximum supply of 21 million tokens.

Gautam Chhugani, Bernstein’s global head of digital assets research, said the 40-year era of falling interest rates has ended, raising the interest burden on government debt that has swollen to record levels. In that environment, holding scarce assets such as Bitcoin that cannot be easily issued or diluted may favor investors.

Eric Balchunas, Bloomberg Intelligence’s senior ETF analyst, also said the trend is important for Bitcoin over the long term. Bitcoin’s original investment case as a hedge against policy-driven currency debasement is gaining traction again.

Gold has risen about 13% this month, climbing above $4,600 an ounce, while Bitcoin has also moved above $80,000. Noel Acheson, publisher of Crypto Is Macro Now, said the speed of the inflows matters more than the simple fact that money is coming in. Investors may be rapidly increasing allocations to scarce assets after previously keeping exposure low.

Still, some strategists argue the tandem rally cannot be explained entirely by debasement fears. Hardika Singh, an economic strategist at Fundstrat, said gold and Bitcoin may have further room to rise, but fiscal concerns alone may not be enough to sustain the advance. Stocks, she added, could prove a more stable hedge.