Correlations Now, All-Time Highs Later
That’s because, when things get really, really bad, you sell what you can. We saw it in February and March as the impact of COVID-19 ravaged equities and crypto alike.
At the same time, Bitcoin and other cryptocurrencies bounced off the March 13 lows and have rallied right alongside stocks.
Indeed, as we noted in a Saturday morning tweet, “The only issue with BTCs price action in the last few weeks is that it’s trading in lockstep with equity indices.”
The only issue with BTCs price action in the last few weeks is that it's trading in lockstep with equity indices. Stocks go up, #BTC goes up. Stocks go down, #Bitcoin goes down. Not a good look for a remainder of the year.— Weiss Crypto Ratings (@WeissCrypto) June 20, 2020
We’re also seeing stepped-up interest from institutional investors in the aftermath of Bitcoin’s third halving in May. That’s a good sign of confidence in its continuing uptake and rising utility. But there are negative implications, too.
Number of #Bitcoin whales has risen by 2% since halving, which clearly shows strong confidence investors have in #BTC, long-term. The only issue is that most people wait for the price to go down before buying more, so the price doesn't go anywhere.— Weiss Crypto Ratings (@WeissCrypto) June 20, 2020
As Bitcoin matures, it should establish its own trading profile. In fact, that has to happen for it to break out to new all-time highs from these levels ...
The COVID-19 crisis has once again exposed the fragilities of the old-school financial system. And the response of old-school policymakers will, of course, only exacerbate those fragilities. Eventually, that soft-money system will fail.
Bitcoin is still distinguishing itself from fiat currency. It’s still making itself known to the investor community. And the general public still has very little idea of it.
More and more, though, events highlight its strengths as an alternative medium of exchange and store of value.
Juan and Bruce