Gold experienced a legendary single-day big dump of 6%, "safe haven market collapsed," experts warn: Is Bitcoin next?

Gold's single-day big dump refreshes a ten-year record, Wall Street re-examines safe-haven assets, and Bitcoin, dubbed 'digital gold', is under pressure simultaneously. (Background: Former PayPal president: Bitcoin breaking one million dollars is just a 'matter of time', with market capitalization potentially equaling gold.) (Context: Wall Street warns: Gold reaching 4,000 dollars proves the de-dollarization is brewing, with buying Bitcoin for hedging 'devaluation trades' becoming prevalent.) Gold and silver prices plummeted sharply last night into this morning (22), falling from historical highs, with gold at one point dropping 6%, marking the largest single-day decline in ten years; silver also plunged 7.1%, once hailed as the ultimate insurance during turbulent times, now unexpectedly becomes a market alarm, forcing investors to reassess whether the concept of safe-haven has been diluted by high leverage and emotional trading. Three forces behind gold's flash crash: First, overheating in technicals coinciding with profit-taking. Tim Waterer, chief market analyst at KCM Trade, pointed out: 'In the face of soaring gold prices, traders are greatly tempted to lock in profits.' Notably, after gold surged to 4,300 dollars per ounce, technical indicators were fully overbought, making a pullback inevitable; second, a stronger dollar diluted the appeal of dollar-denominated precious metals; third, the U.S. government shutdown led to a delay in the CFTC's release of holdings data, with the market lacking short-term reference points, exacerbating panic selling. ANZ Group analysts Brian Martin and Daniel Hynes believe that funds had heavily increased positions in precious metals, stating, 'When positions accumulate to the limit, any small disturbance could trigger a chain reaction of selling pressure.' Wall Street acknowledges the chaos in the safe-haven market. Following the crash, bond king Bill Gross emphasized again that gold's trend resembles 'meme stocks,' with its parabolic rise ultimately ending in disappointment. Relatively conservative Bridgewater founder Ray Dalio reminded that gold remains a 'systematic insurance' under economic disorder and policy chaos. This divergence highlights that the standards for safe-havens are being redefined: short-term speculation and central bank buying push up prices, yet may not provide true defense. Some funds have shifted towards Swiss bonds, seen as low-leverage and highly stable, reflecting investors' desire for 'quantifiable safety.' However, City Index researcher Fawad Razaqzada reminded that the gold bull market pattern has not ended, and deep adjustments could instead provide an opportunity for investors who missed the market to increase their positions. Bitcoin's safe-haven myth encounters cooling. The crash in the traditional safe-haven market has also led Bitcoin, viewed as 'digital gold,' to fail as a shelter. Recently, Bitcoin plummeted from 125,000 dollars to 103,600 dollars in an instant, with a decline exceeding 18%, approximately 19 to 20 billion dollars in leveraged positions were liquidated. Notably, while gold rose, Bitcoin simultaneously fell, and now, with gold's sharp decline, Bitcoin remains consolidated. Based on past experiences, Bitcoin may exhibit adjustments in response to the emotions of the safe-haven market in the future. The crash in the safe-haven market indicates that the hedging sentiment has reached a new peak, with gold, as a more mature market, having adjusted first, whereas Bitcoin's situation remains murky. Wall Street has repeatedly touted Bitcoin's safe-haven function, but in practice, it has often lagged behind gold. Whether this time, after gold's crash, Bitcoin will still follow the past logic of rising after gold, remains to be seen. Investors need to be cautious of the changes in liquidity risks in the crypto market following the crash in the safe-haven market. Regarding liquidity, when news broke about the U.S. government seizing approximately 15 billion dollars in crypto assets, market liquidity concerns immediately arose. Gold skeptic Peter Schiff described Bitcoin as 'more like tech stocks,' correlating with high Beta assets, making it difficult to provide stability amid turmoil. Diversified allocation becomes the only consensus. Bitcoin and gold are not necessarily opposing: the former offers growth potential, while the latter contributes stability, with both roles like 'offense' and 'defense.' However, this simultaneous turmoil proves that a single asset cannot permanently bear the defensive task. In the future, investors will inevitably increase their liquidity in cash and short-term bond allocations, while continuously monitoring Trump’s fiscal policies, geopolitical negotiations, and dollar trends. The epic crash of gold has not ended the demand for safe-havens, but rather reminds the market: safe havens themselves can also be engulfed by waves. When prices stray far from fundamentals, risk management and diversified allocation are more reliable than belief. From precious metals to digital tokens, the safe-haven market is being rewritten. When the next storm arrives, portfolios relying on a single asset may once again be exposed to the crest. Related reports: Gold breaks through 4,200 dollars historical high! Silver also breaks records, will safe-haven assets continue to surge? Gold spot crosses 4,014 dollars/ounce; Goldman Sachs: Global central bank buying spree continues for another three years. Bridgewater's Dalio calls dollar recession 'gold is indeed safer': I feel the market is in a bubble. <Epic single-day drop of 6% in gold: 'safe-haven market crash', experts warn: Is Bitcoin next?> This article was originally published on BlockTempo, the most influential blockchain news media.