Despite a general market downturn, Bitcoin demonstrates signs of resilience, reflecting the changing dynamics of the cryptocurrency market in times of economic uncertainty.
Bitcoin vs Traditional Assets
According to Binance Research, Bitcoin saw a 1% increase on April 7, 2023, reaching nearly $79,000, despite a general decline in U.S. stock indices. This indicates Bitcoin's resilience amid the decline of traditional risk assets caused by tariffs imposed by U.S. President Donald Trump.
Changing Asset Correlations
Historically, Bitcoin has had a low correlation with gold, averaging around 0.12 over the past 90 days. In contrast, its correlation with equities stands at 0.32, prompting analysts to question whether Bitcoin can return to its long-term pattern of low correlation with the stock market.
Bitcoin's Position as an Economic Hedge
A recent survey indicated that 58% of fund managers preferred to hold gold during a trade war, while only 3% would choose Bitcoin. This highlights the question of whether Bitcoin can maintain its appeal as a non-sovereign asset in an increasingly protectionist global economy.
Therefore, despite current economic instability, Bitcoin shows signs of resilience. Investors are closely monitoring whether cryptocurrency can retain its role as a safe-haven asset.
