By Shelly Melancon (Switzerland)
There is a rising interconnection between BTC and the top tech stocks, as shown on the Nasdaq 100 index. However, BitMex co-founder, Arthur Hayes, opines that a decline in the performance of big tech stocks will cause a price dip for BTC and ETH.
The Rising Correlation Between BTC And Top Tech Stocks
A new Bloomberg report remarked that there is a growing connection between BTC and other markets, especially top tech stocks. The popular media publication further remarked that this interconnection started during the early phase of the COVID-19 pandemic. According to the Bloomberg data, the one-month interconnection between the leading digital currency and NASDAQ 100 index reached 0.6946 last Friday.
The closer this index gets to one, the stronger the interconnection between BTC and the top tech stocks. This rising correlation questions the widely held belief that BTC is an excellent choice of diversification.
Some BTC Advocates Question A Popular BTC Belief
Many BTC advocates have portrayed the leading digital asset as the best investment alternative because it has no relationship with other markets. Unfortunately, the stats have shown otherwise, especially as more investors enter the BTC market. Since January 2022, some industry analysts have claimed that the crypto market behavior is gradually falling in line with how institutional investors want it to behave.
They opined that these institutional investors are causing digital currencies to go mainstream. Thus, making the market behave like the traditional markets. Hence, many of these analysts now have a divisive opinion about BTC. Some remain adamant that BTC is still the best investment choice for diversification, while others opined that investing in BTC should mainly be for emergency purposes.
However, the former stance may not hold based on the current BTC price action. Hence, investing in BTC for emergency purposes is the best option. A few expert investors also claim that BTC’s overall value will increase once cryptos go mainstream.
BTC And ETH Will Decline If The Top Tech Stocks Decline – Bitmex Co-Founder
Co-founder of BitMex (a top crypto exchange), Arthur Hayes, remarked that this rising interconnection indicates that BTC and the top tech stocks will behave similarly in price movements. But he also said, “this isn’t a correlation we want for the crypto market. Big tech stocks can be affected by declining economic growth, increasing inflation rates, and global fiat liquidity conditions, but we don’t want those factors to affect BTC and ETH.”
“However, this will likely happen if this interconnection keeps rising,” Hayes added. Hayes, known for commenting on crypto market trends, had earlier in the year remarked that Europe’s sanctions on Russia would result in a significant transformation of the world’s financial order. The BitMex co-founder claims that a period of dominance for Gold and BTC is imminent, which will be highly beneficial for the two inflation-proof assets. Hayes further claimed that the BTC price would soon hit $1M.
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