Dave PortnoyThe pronounced founder of Barrestool SportsLast week placed a simple question about X that hit a nerve in the crypto world: “If the point of Bitcoin is independent of the US dollar and not regulated, why does it actually act exactly like the US stock market nowadays?”
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That one line together summarized what many casual investors have wondered, especially because bitcoin and crypto shares took a dive after the president Donald Trump's New rates round on Wednesday.
Bitcoin floated almost $ 88,000 before Trump's announcement. Not long after the rate policy was unveiled, it slid under $ 83,000. It wasn't alone. Shares that trade in refueling after hours, with technically heavy ETFs such as Invesco QQQ (Nasdaq: QQQ) decrease by 4%.
Crypto-linked shares also followed the same trend. MicroStrategy (Nasdaq: MSTR) decreased 7%, Coinbase (Nasdaq: Coin) decreased by 6%and Robinhood (Nasdaq: Hood) lost 9%.
So far 'independent'.
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Many people came in to answer Portnoy's question. Some pointed to institutional involvement, others blamed emotions and some leaned on technical analysis.
“Bitcoin acts as a risk -active in the short term because it is the most liquid, salable, 24/7 assets on earth,” said Micrstrategy Executive Chairman Michael Saylor. “In times of panic, traders sell what they can do, not what they want.”
And then there is simple logic. “If you had to pay rent, what do you sell first? Apple Stock or your crypto bags?” A user wrote.
Another answered: “Boom. If you realize that big money Bitcoin has already hijacked and it is no more than the stock market.”
Others became sarcastic: “Day 1 of the Berenmarkt: Portnoy discovers what correlation means.” And: “It used to be a currency before it was hijacked and turned into a collective object.” Prominent analyst Benjamin Cowen also stacked himself and said, “How can you be your age and write something like that?”
Some users defended Bitcoin's original intention. “Traders are the foam. Hodlers are the floor,” someone said. Another added: “Bitcoin is the best performing assets in the past 15 years.”
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This latest Bitcoin -drop did not come out of nowhere. Wall Street already staggered from inflation data and weak consumer sentiment. On Friday, a few days before 'Liberation Day', the industrial average of Dow Jones fell more than 700 points, the S&P 500 fell 2%and the Nasdaq (NADDQ: NDAQ) lost almost 3%.
Then Trump's rate announcement came, renewing the fears of the trade war. The GDPNOW prediction of the Atlanta Fed now shows a GDP drop of 2.8% for Q1, an increase of -3.7% on 1 April.
Although Bitcoin has shown some resilience compared to shares, it still moves in the same direction as fear strikes.
Some still believe in one of the original promises of Bitcoin: a decentralized hedge against economic chaos. But for now most of them agree that Bitcoin is still a risk-to-active, and it acts like one.
As Portnoy noted, it looks more and more just a different part of the system that it was intended to replace – “Market Up, Bitcoin up. Market Down, Bitcoin Down.” Or, as Ross GerberCEO of Gerber Kawasaki, said: “BTC price movements are related to sentiment. Risk of, up. Risk, down, down.”
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This article Dave Portnoy says what many think, “if Bitcoin should be independent of the dollar, why does it act just like the stock market?” Originally published on Benzinga.com
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