Crypto, blue-chip companies 'are holding up against the mother of all stress tests': Analyst
Well, as weve seen, that ship has clearly sailed but lets take a deeper dive now with noelle atchison genesis trading head of market insights, to see what we have whats happening with crypto so now. Well, obviously, we saw a lot of volatility going into this a lot as we see whats happening with bitcoin prices still hovering around that 20. 21. 000 mark. What state is crypto in right now, thanks rachelle, very good to be with you. I do have to say that nothing essays investment advice, obviously and everything i do say on my opinions and not that of my employer, but seriously um very welcome rally on the back of the fed announcement today, much like the traditional markets and its an interesting in Terms of the correlation we saw the correlation between bitcoin and the s p 500 hit all time highs in early may, then, with a terror implosion that starts to decouple its been trending down ever since, but its still above 0.5, which shows that, while less affected by Macro considerations, crypto markets are still very largely influenced by macro sentiment and the relief rally is after what weve seen over the past few days in the crypto markets. As im sure many of your viewers are aware very welcome well noel with the crypto market. Clearly, on cheeky ground, you can see that from the reaction that weve seen in bitcoin over the last several weeks now were seeing the fed get more and more aggressive.
Yes bitcoin and the equity markets reacting okay today. But what does that mean for a few weeks down the line or looking ahead to july, at for the feds next meeting, thats a very good question: uh shut up? We have been hit hard by sentiment over the past ever since the beginning of may actually with the terror implosion and what were seeing now with some of the unwinding of leveraged positions in the market is its a difference crisis, but its a continuation of that. However, as we all know, we weve been through this before and any crisis, well, not to belittle the pain that many of our investors are feeling and in crypto. The pain can be quite intense, but not belittle that any down market does set the market up for upside on the other side. And what is interesting is the differences between this crisis and the last time we were with this with this type of a drawdown, which was back in in late 2018, very different market, now very much more institutional, but were seeing crypto being talked about in regulatory offices. At the highest level, all around the world were seeing crypto being discussed in boardrooms at the highest level, all around the world, the diversity of investors, the diversity of use cases is clearer than ever and thats just bitcoin going down the stack d5. While it may have issues lets take a moment to appreciate how well it is actually holding up sure there are some exceptions, but some of the blue chips that have been around for a few years now theyre holding up under the mother of all stress tests, and You hear it in congress all very often.
You also hear it, of course, with fidelity and retirement, but what i hear about those who have stayed on the sideline through all of this noel is: what is it? How do i view it because they were told it was a hedge against inflation? We have now learned that is not the case and it appears to be trading like a very volatile and very risky tech stock, so those that have remained on the sideline. How should they view it? I love that question dave because it highlights one of my favorite aspects about bitcoin in particular, and while this is not investment advice, it highlights that bitcoin is many things to many people that gives it resilience. Diversity breeds resilience. It has a diversity of investor cohorts, it has a diversity of use types for some, it is a store of value, a long term, emerging store of value and any heat inflation. Hedges are not supposed to be short term anyway, so a long term store of value. Given its hard cap, given the potential changes in demand for some, it is a risk asset for some it is an early stage technology play and for others it is a payment mechanism, while you – and i may not need it for that much of the world, does It is still better than what they have so that diversity of thought around bitcoin is one of its strongest features. So, in the answer to the president, what is bitcoin it is, and this may sound hand wavy, but it really is whatever you want it to be.
People often ask me dave: how do i get my head around this industry? How do i come into this industry? What do i look for, and my answer is always well look around any problems that you think might need to be solved in the world. There is a solution being worked on in the crypto industry. There really is something for everyone here and so my advice, this is investment. Advice is learn about it, learn about the market, think about what you need to think about what you think needs fixing and then try and understand what the crypto industry itself is doing about that, and there is a good point there about sort of classifying it. We know regulators still grappling with that. A big thank you to noelle atchison.