Gold crashed 12%.
Bitcoin crashed to $81,000.
Both on the same headline: "Warsh is hawkish."
Both wrong for the same reason.
Here's what nobody's connecting:
Warsh himself said Bitcoin "might serve as a sustainable store of value, like gold."
He was an early investor in crypto startups.
He's not anti-Bitcoin. He's anti-Bitcoin-as-currency.
But Bitcoin-as-store-of-value? He explicitly endorsed it.
Sound familiar?
That's the SAME thesis driving gold.
Not yield. Not currency. Store of value in a world where property rights are revocable.
The market sold both assets on "hawkish Fed = tight money = risk-off."
Level 1 thinking.
Level 2:
Warsh CAN'T be Volcker.
$38.43 trillion in debt.
$3 billion per day in interest.
5% real rates would add $2 trillion to annual interest expense.
The entire discretionary budget is $1.7 trillion.
He inherits fiscal dominance. He said so himself.
And his actual policy preference?
Balance sheet reduction + rate cuts.
That combination WEAKENS the dollar.
A weak dollar is bullish for BOTH gold AND Bitcoin.
Today the market priced Warsh's reputation.
Tomorrow it prices Warsh's constraints.
Gold and Bitcoin crashed together.
They'll recover together.
Same thesis. Same trade. Same misunderstanding.
Those who sold on the headline will buy back higher.