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