Bitcoin’s BTC rise to new all-time highs is happening on a backdrop of deep economic strain, according to a new report from Cathie Wood-led ARK Invest.
Bitcoin’s 11.1% climb in May, outpaced gold and broke through key resistance levels, said ARK. Gains also coincided with clear signs of stress in the housing and auto sectors, traditionally seen as pillars of U.S. consumer strength.
In housing, the number of sellers has far outpaced buyers, a trend ARK links to the Federal Reserve’s steep rate hikes since 2022. With affordability deteriorating, pressure is mounting on prices in what remains the largest source of household net worth. Meanwhile, auto sales, which surged earlier this year in anticipation of tariffs, collapsed in May — falling to 15.6 million units from above 17 million just a month prior.
As these markets soften, bitcoin appears to be catching some of the capital looking for yield and resilience, ARK noted. Spot bitcoin ETFs drew $5.5 billion in May — more than triple the inflows seen in gold ETFs, which dropped sharply during the same period.
ARK noted that bitcoin’s current rally doesn’t yet reflect speculative excess. Profit-taking behavior remains measured, with unrealized gains sitting well below the levels that marked prior bubbles.
For investors moving away from stressed real-world assets, bitcoin may be serving not as a gamble, but as a calculated reallocation in a shifting economic landscape.