Bitcoin has not been a hedge against inflation for a long time, analysts of Bank Of America have concluded.
Starting from July 2021, the largest cryptocurrency in its price behavior correlates well with the dynamics of the stock market. On January 31, Bitcoin’s correlation with the S&P 500 Index hit an all-time high. The new all-time high was close and in correlation with the Nasdaq 100.
The bank specialists have stressed that this relationship “became apparent.” They noted a simultaneous fall in stocks and bitcoin the day after the Federal Reserve (Fed) decided to raise the key rate by 0.5%. Analysts expect the high correlation to continue in the future.
The price relationship between Bitcoin and gold has, on the contrary, been gradually weakening since 2021 and has become negative in the last two months. In other words, the movement of the two assets did not go in tandem.
