For Bitcoin, there’s only been one constant recently: decline after decline after decline. And the superlatives have piled up really quickly.
Bitcoin’s decline since that November high has wiped out more than $US570 billion in market value, and roughly $US1.17 trillion has been lost from the aggregate crypto market. “Crypto is reacting to the same kind of dynamics that are weighing on risk-assets globally,” said Stephane Ouellette, chief executive and co-founder of institutional crypto-platform FRNT Financial. “Unfortunately for some of the mature projects like BTC, there is so much cross-correlation within the crypto asset class it’s almost a certainty that it falls, at least temporarily in a broader alt-coin valuation contraction.
Take also the correlation between bitcoin and Cathie Wood’s ARK Innovation ETF, a pandemic poster-child of speculative risk-taking. That correlation stands at around 60 per cent year-to-date, versus about 14 per cent for the price of gold, according to Katie Stockton, founder and managing partner of Fairlead Strategies, a research firm focused on technical analysis. It’s “reminding us to categorise bitcoin and altcoins as risk assets rather than safe havens,” she said.
Without a systemic shock, that's the key
“Buy the dip”! 🤪
That’s crypto. Not even shook 😄