Bitcoin has mirrored the sharp fluctuations in traditional markets this year, highlighting the tightening link between cryptocurrencies and mainstream financial assets as more professional traders enter the digital finance arena.
The world’s biggest cryptocurrency is increasingly tracking the movements of assets that exert influence across other global markets. Correlations with US tech stocks, crude oil and government bonds have all risen significantly over the past two years, Goldman Sachs research shows.
Bitcoin has often moved in near lock-step with Nasdaq 100 futures — derivatives that are considered a proxy for sentiment towards America’s tech giants — as markets have wobbled in the opening weeks of 2022. While the price moves in bitcoin tend to be much sharper than those of many traditional financial assets, the linkages between the two asset classes are capturing the attention of analysts and investors.