Bitcoin (BTC) There are many opinions about the reasons for the last rally that pushed the price up to the $29,000 mark.
However, many crypto users think that the recent rally is partially related to the banking crisis in the USA.
Brooks Claims Bitcoin Is No Different From Risk Assets That Move With The Fed
According to Robin Brooks, a prominent economist and former chief currency strategist at Goldman Sachs, the increase in Bitcoin’s value has nothing to do with any uniqueness of BTC.
Brooks argues that Bitcoin’s upward move is part of a general trend in high-risk assets, driven by the Fed’s dovish monetary policy.
Bitcoin is rising – not due to any kind of special sauce the HODLER bros go on about – but because the Fed is more dovish, which lifts all high beta assets. There’s absolutely nothing unique in how Bitcoin trades. It’s just another bubble asset going up and down with the Fed… pic.twitter.com/aJ5OZqkQgu
— Robin Brooks (@RobinBrooksIIF) March 25, 2023
Brooks claims that Bitcoin is not unique in terms of price action and is another bubble asset that rises and falls with the Fed. Brooks thus rejects the arguments of Bitcoin enthusiasts who claim that BTC is a revolutionary technology that will change the way we think about money and finance.
Instead, the analyst sees Bitcoin as a highly volatile and speculative asset open to market fluctuations.
The analyst also referred to BTC as a “high-risk beta asset.”
In finance, “beta” is a measure of an asset’s volatility or risk relative to the overall market. High beta assets are assets that are more sensitive to market fluctuations and tend to experience greater price fluctuations than the market as a whole. According to Robin Brooks, Bitcoin is a high beta asset, meaning its price tends to rise and fall more dramatically than the overall market.
*Not investment advice.
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