Bitcoin Is Now Correlated with Gold and Stocks: Digital Asset Data Report

Libra Coin News
Thu, 08/22/2019 - 06:00
Alex Dovbnya
Whether you like or not, Bitcoin is already shaping up to become a legitimate store of value   
Cover image via 123rf.com
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According to a new report released by crypto-related analytical firm Digital Asset Data, there is a growing correlation between Bitcoin and traditional assets, such as gold and stocks. Hence, it validates the narrative that the cryptocurrency that started it all has joined the ranks of hedge assets.

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The charts don’t lie 

Prior to Bitcoin’s rally in 2019, there was practically no correlation between Bitcoin and other markets. However, the top coin now seemingly moves in synch with gold. Hence, there is an ongoing war between the two camps about what assets can be considered a better store of value ahead of the brewing global recession.

The proponents of “digital gold” claim that the shiny metal is too archaic for the digital era. This essentially became the focus of Grayscale’s “Drop Gold” campaign.   

image by marketwatch.com

Meanwhile, as the chart above shows, BTC is inversely correlated to the US equities.  

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Is Bitcoin a safe haven?

The study mirrors the opinion previously voiced by Circle CEO Jeremy Allaire who believes that BTC can act as a safe haven asset. Allaire also suggested that a risk-off environment in the US stock market could be the reason for the coin’s recent price slump.

The findings tend to signal that Bitcoin is starting to behave more like a store of value and is potentially being used as a safe-haven asset during global uncertainty in traditional markets,” Ryan Alfred, president of Digital Assets Data.

Although Bitcoin bull Brian Kelly hates the term “safe haven,” he does admit that macro funds now view Bitcoin as an alternative to gold.

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with an extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.