Bitcoin may behave more like US Treasury bonds: Bloomberg Intelligence

Bloomberg Intelligence’s latest research on crypto markets suggests that Bitcoin could begin to behave more like U.S. Treasury bonds and gold rather than stocks.

The research unit compared the Bitcoin market to gold, bonds and oil in its August Crypto Outlook Report, which was authored by Mike McGlone, Senior Commodity Strategist, and Jamie Coutts Senior Market Structure Analyst.

According to the authors, similarities exist in Treasury bond markets as well as Bitcoin due to macroeconomic influences like the Federal Reserve’s Monetary Policy.

“Tightening markets, plunging global growth support Federal Reserve’s shift in July to a “meeting-by-meeting” bias. This may help Bitcoin move towards a directional tilt that is more like US Treasury bonds rather than stocks.

They added that the “dump-following pump nature of commodities” as well as receding yields on bonds suggest an increase in probability that Bitcoin, gold, and bonds will be buoyed by falling inflation.

Is the Flush Over? Link to Pdf: Link to Pdf:
Mike McGlone (@mikemcglone11), August 3, 2022

T-Bonds are Treasury bonds. They are long-term government debt securities that are issued by the U.S. Treasury Department. They are fixed-rate securities with a maturity period of 20-30 years.

According to the report, crypto markets saw their largest-ever discount in comparison to July’s 100-week moving mean. The report stated that Bitcoin is not expected to trade below its 200-week moving mean.

Analysts stated that BTC’s 70% drop from its peak in August, but still five times greater than its March 2020 low, “shows its potential.”

They cited the $20,000 area as key support, and they anticipate a base building similar to the $5,000 level for 2018-19.

Related:Bitcoin bulls target $25K price Friday’s expiry of $510M options

Researchers concluded that Bitcoin was one of the most successful assets in the world since its inception a decade ago.

“We believe more of the same is ahead. Particularly as it transitions toward global collateral with results more aligned to Treasury bonds or gold.”

According to Coinbase research, July’s crypto-asset class risk profile is comparable to oil and tech stocks. Cesare Fracassi is the chief economist at Coinbase. He stated that the correlation between stock and crypto-asset price has increased significantly since the 2020 pandemic.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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