Recent research has highlighted the variable correlation between Bitcoin and the US stock market, prompting inquiries about its reliability as a safe asset.
Bitcoin and Stock Market Correlation
According to data from RedStone Oracles, Bitcoin has exhibited a strong negative correlation with the US stock market in the short term. However, the 30-day indicator suggests a "variable correlation" ranging from -0.2 to 0.4. This indicates that Bitcoin does not consistently serve as a reliable hedge for equities.
Expert Opinions on Bitcoin's Future
According to Marcin Kazmierczak, co-founder of RedStone, Bitcoin needs to "mature" as a global asset. He pointed out: "Increased institutional adoption will absolutely help—we're already seeing this effect with corporate investments reducing Bitcoin's volatility."
Bitcoin's Performance in Portfolios
Despite uncertainties, Bitcoin exhibits high potential as a portfolio diversifier. Its annualized return over the past five years has exceeded 230%, significantly outperforming traditional assets such as stocks and safe-haven investments.
Thus, while Bitcoin may not always be considered a safe asset, its role as a portfolio diversifier is becoming increasingly significant, particularly in light of growing institutional adoption.
