Meanwhile, Bitcoin’s correlation to the stock market weakened as it mimicked a safe-haven asset.
Aubert notes that people are attempting to fit Bitcoin into a traditional framework, but this is challenging because Bitcoin can take on many different roles.
Regarding Bitcoin’s correlation with the S&P 500, Aubert states that it dropped significantly in March to 20%, continuing a trend that has been evident for several months. She added that this correlation is now essentially negligible.
Despite this, Aubert asserts that Bitcoin will still be affected by factors that impact stocks, such as the Federal Reserve’s monetary policy. Additionally, Bitcoin is susceptible to changes in overall liquidity.
CoinShares’ Head of Research James Butterfill points out that as Bitcoin becomes more similar to a safe haven asset and less like a risky one, there are some critical similarities between Bitcoin and gold.
Butterfill notes that one shared characteristic between the two assets is their value is backed by a limited supply. While there is a finite amount of gold available, Bitcoin’s supply is capped at 21 million, and it’s projected that the last Bitcoin will be mined in 2140.
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In contrast to gold, which can be found anywhere in the universe and brought to Earth, bitcoin is a harder asset due to its limited and known supply.
In terms of cultural overlap, there may be indications that Bitcoin and gold are converging in this regard as well. At WrestleMania 39, California-based rapper Snoop Dogg was observed wearing a golden hardware wallet, resembling an expensive chain.