Diversification of safe-haven assets: Under the shadow of the China-U.S. trade war, Bitcoin fell by 9% to around $110,000, while gold reached a nearly two-month high.

Affected by the rekindling of the US-China trade tensions, global market risk aversion has intensified, leading to a significant pullback in Bitcoin (BTC) prices by 9% to $110,700 this week, erasing most of last week's gains. This dumping highlights the close correlation between crypto assets and traditional stock markets, with the 40-day correlation between BTC and the S&P 500 index climbing to 73%. Meanwhile, gold prices rose by 1.9% to $4,018, reaching the highest point since August, indicating that traders are prioritizing tangible safe-haven assets over speculative assets in the face of macro uncertainty.

Tariff threats trigger global dumping, Bitcoin follows the stock market decline

U.S. President Donald Trump threatened the latest tariff measures effective October 1, triggering global "Risk-Off" sentiment.

· Market linkage: Tariff threats led to a 2% drop in the S&P 500 index, and Bitcoin also significantly pulled back. BTC's 40-day correlation coefficient rose to 73%, highlighting that Crypto Assets are still subject to broader market sentiment in the short term.

· Traditional safe-haven assets favored: As a traditional hedging tool, gold performed strongly, rising 1.9% to 4,018 USD, reaching a nearly two-month high. The yield on U.S. Treasuries declined, with funds flowing into defensive assets. This indicates that, despite Bitcoin being hailed as "digital gold," in the current macro panic, investors are still placing tangible safe-haven assets above speculative assets.

· Shrinking trading volume: Bitcoin's market value has fallen to $2.1 trillion. Spot trading volume has decreased by 1.17% year-on-year, and analysts believe that BTC's next move will depend on the U.S. inflation data and Federal Reserve guidance to be announced this week.

Institutional Confidence Continues to Grow: Blockchain Integrates with Traditional Finance

Despite the short-term correction in Bitcoin prices, institutional confidence in blockchain technology and the digital asset ecosystem has not wavered, but rather shows a trend of accelerated integration.

· Traditional finance embraces tokenization: The US trading platform Blue Ocean (serving brokers like Robinhood and Schwab) announced plans to tokenize US stocks, allowing traditional stocks to be traded 24/7. This move aligns with Nasdaq's proposal for listing tokenized ETFs, highlighting that established financial institutions are steadily integrating blockchain technology.

· Deutsche Bank: Bitcoin is expected to enter the ranks of reserve assets: Deutsche Bank's latest report draws a comparison between Bitcoin and gold, noting that the gold reserves held by global central banks currently account for 24% of total reserves (the highest proportion since the 1990s). DB strategist Marion Laboure predicts that by 2030, Bitcoin is expected to follow a similar path and become part of reserve assets, stating: "Even though Bitcoin remains volatile and is not asset-backed, its correlation with inflation-hedging assets like gold continues to grow."

· Institutional Action: Nasdaq-listed company Aurelion Treasury announced the establishment of a $150 million reserve, supported by Tether Gold (XAUT), becoming the first of its kind corporate treasury. Following the announcement, the company's stock price soared by 19%, reflecting investor enthusiasm for digital assets linked to tangible value.

Technical Analysis: Testing $108K support level, still a healthy correction

(Source: TradingView)

The current 9% drop in Bitcoin is the largest single-day decline since April, and it is currently hovering near a key technical support level.

· Key support tested: The price is fluctuating near the key support range of $108,000 to $110,000. On the daily chart, BTC has broken below the short-term trend line, confirming that market momentum has shifted to a short-term bearish outlook.

· Momentum indicators are weak: the RSI index is at 39, indicating a weakening of buyer control; the MACD has turned negative, signaling short-term downside risk. A large Bearish Engulfing Candle pattern further emphasizes the increasing selling pressure.

· Key support and rebound targets: If BTC fails to hold the $108,000 mark, the next major support levels will be $103,000 and $98,200, which have historically attracted significant accumulation. Conversely, if the price can rebound above $117,000, it will eliminate bearish setups and pave the way for a recovery to $124,000.

· The long-term trend remains unchanged: as long as the BTC price stays above $103,000, the broader long-term trend remains intact. Analysis suggests that this pullback is a healthy "mid-cycle reset" rather than a full reversal. With institutional capital flows remaining strong and ETF demand stable, once macro pressures ease and liquidity returns, Bitcoin is expected to regain momentum and move towards $126,000.

Conclusion

The short-term weakness of Bitcoin is an inevitable response to the global market's "risk-averse" sentiment, highlighting its limitations as "digital gold" under extreme macro uncertainty. However, the accelerated integration of blockchain technology and tokenized assets (such as tokenized stocks and ETF proposals) in traditional finance, along with Deutsche Bank's prediction of Bitcoin's future reserve status, indicate that institutional confidence in digital assets remains structurally strong in the long term. As long as BTC can hold the key defense line of $103,000, this price correction is likely just a necessary shuffle within the bull market cycle.

Disclaimer: This article is for informational purposes only and does not constitute any investment advice. The crypto market is highly volatile, and investors should make decisions with caution.