Bitcoin Price Greatly Depends On Gold And Stocks

2021-08-19 19:40:13

Santiment Data, a leading crypto-analytic company, revealed a report which states that the price of Bitcoin depends greatly on gold and stocks. Moreover, this is probably the biggest reason why bitcoin is noticing a drop in price of up to 7%. This trend of price drops affected several other resources, affecting S&P 500 as well. Consequently, gold also notices a 0.7% drop, and an index of about 2.2%.

Despite the previous way of work where Bitcoin clearly contradicted traditional resources, things are starting to change. More specifically, due to many traders and institutions not really being into crypto, in the last couple of years Bitcoin is facing an enormous income flow.

Furthermore, Bitcoin is also facing a steady volatility drop. Specifically, since 2012 Bitcoin’s volatility is slowly, but surely going down. That is for 30-day average volatility. As a result, Bitcoin’s average is 3% at the moment.

In comparison, in 2012 this number was 3.7%. Consequently, due to the high demand for bitcoin, which eventually changed the original nature of the currency, many traders are beginning to display fiat trading characteristics.

Consequently, as a result of the intertwining of bitcoin with traditional assets such as gold and stocks, if one starts to go down, the other one will most likely follow. Whatever the case, experts cannot decide whether this is good or bad for bitcoin and crypto in general.

However, being that many institutions are opting for Bitcoin, it is clear that the average volatility of this digital coin will only continue to go down. Regardless of the price of Bitcoin is in connection with gold and stocks. And while it is good that more and more people are starting to deal with bitcoin, it only alters the unique characteristic of the coin, very similar to those of fiat currencies.

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