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According to Bitfinex Analysts –
“The relationship between Bitcoin and stocks has been a theme often sighted this year, with Bitcoin being described as “just another risk asset” given its dramatic rise and fall in correlation to equities.This correlation is now breaking down. By mid-October Bitfinex Alpha saw the lowest correlation between Bitcoin and stock indices since the first week of January, reaching zero at one point, indicating no statistical association between the two assets. “
If Bitcoin and equities do have mutual sensitivity to factors such as interest rate rises and the economy it could be for different reasons. It’s therefore clear that the performance of cryptocurrencies, while impacted by economic outcomes and economic projections, were perhaps as not affected as some might have anticipated.
Bitcoin and Ether have performed better than stock indices over the past three months. Despite rate hikes and geopolitical uncertainty, Bitcoin and Ether have held up better than the Nasdaq100. Even as per year-to-date returns, BTC's -56 percent return and ETH's -59 percent return are significantly better than the performance of tech stocks such as Meta's -71 percent or Snap's -80 percent returns. This stronger performance has resurfaced questions about crypto's correlation to stocks.”
Insights come from the exchange’s Alpha report which can be found here.
