Gold Goes Down Hard: Who Needs Crypto When You Have a Heavyweight?

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Key Highlights

  • In a stunning turn of events, gold decided to take a nosedive, shedding about $3 trillion in mere days-talk about an expensive vacation!
  • This loss is grander than the whole cryptocurrency market, which is hanging around at a humble $2.9 trillion-poor thing.
  • After basking in glory with record highs above $5,590 per ounce, gold remembered it was just a shiny metal and fell back down to earth.
  • But don’t worry, the ETF inflows and institutional demand are still strong-like that one friend who keeps coming back no matter how many times you ignore their calls.

Gold just pulled off one of the largest silent wealth shocks in the modern market era, leaving many scratching their heads and checking their bank accounts.

As prices tumbled about 8% from their recent dazzling heights of $5,600 per ounce to a more humble $5,140, the gold market lost an estimated $3 trillion-a number so large it makes the entire crypto market look like pocket change.

To give you a clearer picture, all the cryptocurrencies combined-whether they be Bitcoin, Ethereum, or some obscure altcoin-are worth less than what gold managed to lose in this single act of dramatic flair. According to CoinMarketCap, the total crypto market is currently at a modest $2.89 trillion.

With more than 208,000 tonnes of gold above ground, even a slight price shift can send shockwaves through the market, translating into trillion-dollar swings-who knew shiny rocks could be so dramatic?

The sell-off was primarily due to profit-taking after gold hit its record heights-not a collapse in demand. Spot gold was last trading around $5,150, still boasting a 19% gain for January and 3.6% for the week, making it one of its best monthly performances since the hair-raising 1980s.

Importantly, while gold was having its existential crisis, institutional flows remained positive. Holdings in the SPDR Gold Trust, the world’s largest gold-backed ETF, have risen to nearly four-year highs-proving that big investors still see gold as a must-have accessory, regardless of the pullback.

Demand is also stretching beyond traditional macro funds. Tether’s CEO recently declared plans to toss 10-15% of their investment portfolio into physical gold, showing that even those in the crypto world are hedging their bets with the glimmering metal as uncertainties loom.

Macro conditions remain friendly, too. The U.S. Federal Reserve has chosen to keep rates unchanged, while markets are buzzing about potential rate cuts by June. Political uncertainty surrounding the upcoming replacement of Fed Chair Jerome Powell has only reinforced gold’s status as the go-to hedge in times of chaos.

Crypto felt the same shock, but oh boy, did it look different!

While gold took its hit quietly, the crypto markets were like a soap opera, processing it through forced liquidations.

As reported by The Crypto Times earlier, more than $135.8 million in Bitcoin positions were liquidated in a single day, with most losses stemming from long traders who were waiting for a rebound like a kid waiting for the ice cream truck. Bitcoin slid down to around $87,800, losing about 1.7% in 24 hours as leveraged bets unwound faster than a poorly knitted sweater.

Ethereum followed suit, falling to about $2,940, losing over 2.5% on the day, while nearly $52 million in ETH positions got wiped out. The sell-off picked up speed once ETH broke below the crucial $3,000 mark-a psychological level that had traders quaking in their boots.

In total, crypto liquidations went over $324 million in just 24 hours, with Bitcoin and Ethereum taking the brunt of the damage-like two boxers knocked out in the same round.

Two markets, two stress mechanisms

The contrast could not be clearer.

  • Gold managed to erase ~$3 trillion without any leverage or liquidation drama-just pure, unadulterated value loss.
  • Crypto, on the other hand, evaporated hundreds of millions through visible liquidation cascades, like a magician’s disappearing act gone wrong.

The headline number is indeed shocking, but the structure of the move tells us much more.

Gold erased trillions in value, yet capital still flows in-a clear reminder that size, not stability, defines gold’s volatility. The metal may be slow to move, but when it does, it reshapes balance sheets in ways no other asset class can even dream of these days.

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2026-01-29 22:50