According to a new report of BitMEX exchange Bitcoin copies US shares. Traditional and cryptocurrency markets are more tied than ever. The correlation of these two markets is at its all-time-high.
According to BitMEX, Bitcoin is on the path of extreme correlation with stock markets. This is due to the crisis associated with a new type of coronavirus. Lack of liquidity and a fall in prices afflicting stock exchanges around the world.
Bitcoin price correlation: Record high against the S&P 500— BitMEX Research (@BitMEXResearch) March 29, 2018
More liquidity available to investors and enthusiasm for new technology, may be driving price movements in both stocks and Bitcoin. Bitcoin may now offer less protection from a financial collapsehttps://t.co/nVSh9l3h0L pic.twitter.com/2GHuemgRmV
Bitcoin turned out to be gold at times when the world faces geopolitical instability. It grew during 2016, when Donald Trump was elected, and also in early 2020, when the US attacked Iran’s High Representative. It also shows its strength in long-term politically unstable regimes such as Venezuela, the Middle East and parts of Asia.
However, when everyone is worried about a roof over their heads, trying to put money into cryptocurrencies is going aside. Especially after Bitcoin grew to such a level in 2017 that it became a risky investment in the eyes of the public and not digital gold.