Gold and silver lost about $700 billion in market value in a single day, hammered by a stronger dollar, rising bets on Federal Reserve rate hikes, and a geopolitical shock — Iran's threat to shut the Bab el-Mandeb Strait. The selloff wiped out over $400 billion from U.S. stocks as well, but Bitcoin barely moved, holding near $64,000.
The Iran factor
Iran's threat to close the Bab el-Mandeb Strait — a critical chokepoint for global shipping — jolted markets on Thursday. The move pushed investors into safe-haven assets, but not the usual ones. Instead of gold, money rushed into the dollar and short-term U.S. Treasuries, which pay solid yields while gold and silver pay nothing. The selloff in metals accelerated, with gold falling 1.7% on the day, erasing about $485 billion, and silver dropping 3%, wiping out another $100 billion.
A record gold peak and a steep slide
Gold's slide actually began in late January, when it set a record near $5,600 per ounce. It's now below $4,000. Silver peaked above $121 and sank below $55.50 on Thursday — its lowest level in about seven months. The turnaround has been brutal. In March alone, the SPDR Gold Shares (GLD) exchange-traded fund lost a record $8.5 billion in a single month. Since March 1, GLD has recorded $14.4 billion in outflows, exceeding the $9.6 billion pulled from all spot Bitcoin ETFs since October.
Money rushed to dollars and T-bills
The strong dollar and rising expectations that the Fed might hike rates again are squeezing metals. The central bank held rates at 3.50% to 3.75% in June, but minutes showed a divided outlook, with some officials leaning toward hikes. That's bad for gold and silver, which don't offer any yield. Meanwhile, Antalpha, a Nasdaq-listed lender, handed back over $50 million in gold profits, and its Tether Gold (XAUt) stack shrunk from $329.9 million in January to $138.8 million.
Bitcoin's quiet resilience
Bitcoin traded near $64,650 on Thursday, up about 4% for the week. It barely flinched during the metals rout. Analyst Daniela Hathorn noted that cooler inflation data helped steady Bitcoin, and that BTC now trades like a macro asset with support at $63,000-$64,000 and resistance at $65,500-$66,000. On a relative basis, Bitcoin hit its most oversold level against gold on record — a sign that some traders see the top cryptocurrency as a better store of value right now.
Signs the selloff may be exhausting
There are hints the metals washout is nearing an end. July outflows for GLD stand at just $46 million, a sharp slowdown from the gusher earlier in the year. That could mean the panic selling is mostly done. But the Fed's next decision in late July remains the big unknown. If the central bank signals more hikes, gold and silver could take another hit. If it holds steady, the bleeding might finally stop.
