On March 9, quotes $BTC temporarily dropped to ~$65,700. Experts have differing opinions on the future movement of the market: some expect growth, while others warn of risks of a decline amid macroeconomic uncertainty.
At the time of writing, the asset is trading around $67,185 (+0.1% in the last 24 hours).
Bloomberg Intelligence senior strategist Mike McGlone suggested Bitcoin could drop to $50,000, and silver to $50 per ounce.
Swan Bitcoin Managing Director John Haar noted that in periods of market instability, $BTC behaves like a high-risk asset. In the long term, the price is determined by the expansion of adoption and monetary properties.
Market dynamics heavily depend on institutional investors. Co-founder of Citrea, Orkun Mahir Kılıç, called spot ETFs the main gateway for traditional capital.
MyDoge founder Jordan Jefferson emphasized that locally, macro shocks are pressuring the price of Bitcoin. Globally, independent financial infrastructure only benefits from the weakness of TradFi. Bank failures and the depreciation of fiat currencies are forcing users to switch to digital assets for preserving their funds.
US stock market crash
Ed Yardeni of Yardeni Research believes that the likelihood of a market crash by the end of the year has increased from 20% to 35%. The chances of a speculative surge driven solely by investor enthusiasm have decreased from 20% to 5%.
The main reason for the revision is the rise in oil prices. On March 9, quotes exceeded $100 per barrel for the first time since 2022. The energy shock impacts household income, reduces corporate profits, and complicates the Fed's task.
“The US economy and the stock market find themselves between two fires. The Fed too. If high oil prices persist, the regulator will face a difficult choice between rising inflation and increasing unemployment,” said Yardeni.
Against this backdrop, the main beneficiary has become the dollar. Over the week, the American currency has grown against almost all major competitors. Traditional safe-haven assets like treasury bonds, the Japanese yen, the Swiss franc, and gold are depreciating.
Futures on the S&P 500 index fell by 1.6%. Hedge funds are actively increasing short positions in American stocks.
Despite short-term risks, the strategist's base scenario remains positive:
60% — the probability of the 'roaring twenties' occurring by the end of the year. The scenario assumes robust growth of the US economy due to increased labor productivity. Over the next decade, the likelihood of this scenario reaches 85%.
15% — the chance of a repeat of the stagflation of the 1970s over a decade.
Yardeni emphasized: if investors believe in the reality of stagflation, the onset of a full-scale bear market will become the most likely outcome.
Bitcoin's correlation with the IT sector
The recent synchronous movement of digital gold and shares of American software developers is related to macroeconomics, not structural market merging. This was stated by the head of research at NYDIG, Greg Cipolaro.
Last week, the first cryptocurrency rose along with the IT sector. Against this backdrop, market participants began to perceive Bitcoin as a proxy tool for evaluating development companies.
According to Cipolaro, price charts look similar, but the assets do not share common trends such as AI development. Their simultaneous growth is simply a reaction of liquidity-sensitive risk instruments to current economic conditions.
Over the past 90 days, the correlation of Bitcoin has increased not only with software developers' stocks but also with the S&P 500 and Nasdaq indices.
At the same time, the stock market explains only a quarter of the price movements of cryptocurrency. The other 75% of price changes depend on factors not directly related to traditional exchanges.
The analyst noted that investors are currently not using Bitcoin as protection against macroeconomic shocks. As a result, the asset does not yet justify the status of “digital gold.” Traders buy cryptocurrency simply as one of the risky assets.
However, Bitcoin still has its own economic drivers: network activity, adoption rates, and regulatory features.
“This uniqueness maintains Bitcoin's status as a tool for portfolio diversification. The correlation with stocks is currently high, but it does not define the cryptocurrency's returns,” concluded the expert.
Recall that in early March, VanEck's head Jan van Eck stated that the price of digital gold had approached a local bottom.
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