There are many perceived correlations between Bitcoin and traditional markets. However, some people feel there is only one “pairing” worth keeping an eye on. If Max Keiser is to be believed, stocks don’t matter in the slightest.
Are Stocks Relevant to Bitcoin?
In most people’s opinion, there is a direct relation between the stock market and Bitcoin. If stocks go down, Bitcoin’s price should normally go up, and vice versa. As has been apparent in recent months, that is no longer the case. Both markets will drop like a brick if stocks go down When Bitcoin goes down, stocks won’t necessarily really nor lose ground. A very interesting situation, to say the very least.
On Twitter, Max Keiser shared some interesting insights regarding the matter. He boldly claims how Bitcoin and stocks share no correlation in the slightest. Instead, Bitcoin is closely linked to the movements of the US Dollar. This is a valid statement, as a weak dollar should be beneficial to Bitcoin. Even so, it doesn’t necessarily have to pan out like that either.
#Bitcoin, like Gild, is inversely correlated to the $USD – *not* the stock market.
Don’t be fooled by randomness https://t.co/UIbu7hiW5m
— Max Keiser (@maxkeiser) September 22, 2020
A new stock market collapse can still have interesting consequences for Bitcoin. Whether Bitcoin will plummet, will always be a matter of personal opinion. Keiser is firmly convinced there will be no negative consequences in the long term. Instead, he is more worried about the weakening US Dollar, and what that will mean for Bitcoin.
Max Keiser on Bitcoin and Gold
Max Keiser points out how Bitcoin is akin to gold in terms of market pressure. Stocks make little to no difference for gold on a macroeconomic level. A weak stock market contributes to a higher gold price in a way, but that’s only part of the momentum.
Fiat currencies, on the other hand, are an entirely different creature. Ongoing printing by central banks creates a very interesting situation. More specifically, there is an infinite amount of fiat money in the world. Bitcoin and gold, have a supply cap that cannot be altered by third parties.
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