Bitcoin and S&P 500 Correlation Broken: What Does It Mean?

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bitcoin The correlation between (BTC) and the S&P 500 is negative for the first time since the FTX crash in November 2022. However, for most of 2022, BTC and the S&P 500 (SPX) showed a positive correlation. Except for the collapse of FTX, the last negative correlation was recorded in December 2021.

FTX As a result of its collapse, the cryptocurrency market took a significant hit. The crash resulted in a drop in the value of Bitcoin (BTC). The S&P 500, on the other hand, continued its upward trend. Thus, BTC suffered as a result of the previous correlation loss.

But the recent loss of correlation can have the opposite result. SPX recently reached its highest peak in recent months. However, an immediate correction followed this rise. BTC could rise in the coming weeks as SPX and Bitcoin are negatively correlated.

Can Bitcoin (BTC) Be a Protection Against Inflation?

Bitcoin (BTC) was generally believed to be a hedge against inflation. BTC and other cryptocurrencies were expected to respond with price increases, or at least maintain their value, in the event of massive fiat printing. However, at the same time as inflation rises in most countries in 2022, cryptocurrency A bear market occurred in the units.

to 24KCrypto according toIt is quite possible to see a pullback in the stock market. Considering that BTC and SPX are negatively correlated, this could mean gains for the original cryptocurrency. Not only will BTC stand out from the traditional exchange, but it will also have the opportunity to appeal to investors as an inflation hedge once again.


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