Analysts have been arguing on this topic for several years now. And they have enough soil for this - in 2017, the crypto market grew along with the new price records of the S & P 500 index. A few months later, the classical markets fell, and with them almost at the same time Bitcoin went to the bottom.
How Bitcoin Depends on Shares
Traditional and new assets can move in the same direction for a short period of time. This is due to the fact that investors always follow the general (bearish or bullish) market sentiment. This is sure BitBull Capital CEO Joe Di Pascale.
Investors enter the market when they have optimistic forecasts. At the same time, the market does not have to be traditional or cryptocurrency. When moods change in the opposite direction, they leave trading in assets.
In the long run, analysts did not find any dependencies between stocks and a crypt. This is the conclusion reached at Blockforce Capital. Recently, experts of this company compared the price movement of Bitcoin and S & P 500 from January 2015 to October 2018. Blockforce CEO Eric Erwin said that there is no connection between the coin and the traditional market.
Historically, the correlation between the S & P 500 and Bitcoin has always been negligible. And although this year it has risen, we still do not see the connection between these two assets. However, the lack of correlation still does not mean that if one of the markets falls, the second one will necessarily grow.
Managing Director of Digital Capital Management Tim Enneking believes that after institutional investors enter the cryptographic markets, digital assets will become more like securities.
One of the most attractive factors for investing in cryptocurrency has always been their complete independence from Fiat. The growing correlation between them can make Bitcoin less interesting for large investors.