Gold Cracks, Bitcoin Slips: Cathie Wood’s Gold Call Triggers Market Meltdown

Cathie Wood’s Gold Warning Resurfaces After Violent Market Crash Hits Metals, Stocks, and Bitcoin

Cathie Wood’s long-standing skepticism toward gold surged back into the global spotlight this week after one of the most violent trading sessions in modern financial history sent shockwaves through commodities, equities, and cryptocurrency markets.

Within the first hour of U.S. market trading, trillions of dollars in value were erased across gold, silver, stocks, and digital assets, stunning investors and reigniting debate over whether the rally in precious metals had reached an unsustainable extreme.

Gold prices fell sharply from near $5,600 per ounce to around $5,400, triggering widespread panic selling before stabilizing later in the session. According to market data cited by HOKANEWS, gold briefly lost nearly $3.2 trillion in market value in less than an hour, marking what analysts describe as the largest intraday value swing ever recorded for the metal.

Source: The Kobeissi Letter

The sudden move echoed warnings made by ARK Invest founder Cathie Wood, who has repeatedly argued that gold’s valuation relative to the broader economy has entered historically dangerous territory.

What Cathie Wood Actually Warned About

Despite headlines linking her comments directly to the crash, Cathie Wood’s gold prediction was not based on short-term price movements. Instead, her concerns centered on valuation metrics that compare gold’s total market capitalization to the U.S. money supply, commonly measured through M2.

Source: Xpost

Wood noted that gold’s valuation relative to M2 has reached levels not seen since 1980, when inflation peaked in the United States, and even mirrors conditions observed during the Great Depression in 1934.

According to Wood, such extreme readings typically emerge near the end of long asset cycles rather than the beginning. She argued that current economic conditions do not reflect the type of systemic crisis that would justify gold’s explosive rise.

“The U.S. economy is not facing depression-level deflation or runaway inflation,” Wood previously stated in comments referenced by HOKANEWS. “When gold’s valuation disconnects from underlying monetary realities, it becomes vulnerable if the dollar strengthens or risk appetite shifts.”

A Historic Day of Volatility in Gold and Silver

The market reaction was swift and severe. Spot gold prices, tracked through XAUUSD, dropped more than 8 percent intraday, erasing approximately $3 trillion in value at the session’s lowest point. Prices later rebounded sharply, restoring nearly $2.3 trillion, creating a total daily swing of roughly $5.5 trillion.

Analysts say the magnitude of the move exceeded volatility seen during the 2008 global financial crisis, underscoring the fragility of markets following months of aggressive gains.

Silver experienced even more extreme price action. The metal plunged more than 12 percent intraday, wiping out close to $760 billion in market capitalization. Traders described the selloff as a cascade of forced liquidations following weeks of near-parabolic gains in precious metals.

“Silver was especially vulnerable,” said a commodities strategist interviewed by HOKANEWS. “Once profit-taking began, leverage amplified the downside.”

Stocks Caught in the Crossfire

The shockwave quickly spread beyond commodities. U.S. equity markets opened sharply lower as investors rushed to reduce exposure to risk assets.

The S&P 500 fell approximately 1.2 percent, while the Nasdaq Composite dropped more than 2.5 percent at its lowest point. Combined, U.S. equities briefly lost nearly $1.5 trillion in market value before recovering part of the losses later in the day.

Market analysts attributed the selloff to a sudden repricing of risk following the sharp move in metals, which had been widely viewed as a defensive hedge against uncertainty.

“When defensive assets collapse this quickly, it forces investors to reassess everything,” one Wall Street trader told HOKANEWS.

Bitcoin and Crypto Markets Feel the Pressure

The turbulence did not stop with traditional markets. Cryptocurrency prices fell sharply as volatility rippled across global financial systems.

Source: CoinMarketCap

Bitcoin dropped from around $89,000 to below $82,000, triggering approximately $1.75 billion in liquidations within 24 hours, according to market data. The broader crypto market shed nearly $100 billion in total capitalization during the selloff.

The move was largely driven by forced liquidations in leveraged positions rather than long-term selling, analysts said.

Despite the decline, Cathie Wood’s outlook on Bitcoin remains firmly bullish. She has repeatedly described Bitcoin as a long-term hedge against currency debasement and a transformative financial technology rather than a short-term trading instrument.

Some analysts believe the liquidation-driven decline could ultimately strengthen the market by resetting leverage.

“Painful as it is, this kind of flush often clears excess speculation,” said a digital asset analyst cited by HOKANEWS. “Historically, Bitcoin has recovered strongly after these events.”

A Divided Market on Gold’s Future

Cathie Wood’s comments have once again divided opinion among investors. Critics argue that gold’s volatility proves her point that the metal has become overcrowded and vulnerable to rapid corrections. Supporters counter that central bank demand, geopolitical tensions, and long-term inflation concerns will continue to support gold prices.

In recent months, central banks around the world have increased gold purchases as part of reserve diversification strategies, reinforcing the metal’s role as a sovereign asset.

“Gold is not just a trade, it’s a policy tool for many countries,” said a global macro analyst. “That demand doesn’t disappear overnight.”

Still, the scale of the recent move has prompted some investors to question whether prices had simply run too far, too fast.

What Markets Are Watching Next

Following the historic volatility, traders are now closely monitoring stabilization signals across gold, silver, and Bitcoin. Key indicators include changes in U.S. dollar strength, bond yields, and central bank commentary.

Volatility metrics across multiple asset classes are now running above levels last seen during the 2008 crisis, raising concerns that further sharp moves could follow.

Risk management has taken priority over prediction, analysts say, as investors reassess exposure across portfolios.

“This was a reminder that even so-called safe havens can move violently,” one portfolio manager told HOKANEWS. “Diversification doesn’t eliminate risk, it just reshapes it.”

A Broader Market Reset?

While the immediate shock has subsided, the episode may represent a broader reset across global markets. Gold’s rapid rise and sudden correction, Bitcoin’s leverage-driven pullback, and equity market instability all point to heightened sensitivity to macroeconomic signals.

For Cathie Wood, the events reinforce her long-held view that valuation extremes eventually matter, even for assets traditionally seen as safe.

For investors, the lesson may be simpler. In an era of interconnected markets, no asset exists in isolation, and volatility can travel faster than ever before.

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