25 April, 2024



Bitcoin Hits more Stability than Dow Jones Index

09 Oct, 2022

22 Nov, 2023

It appears that Bitcoin (BTC) is beginning to decouple from equities since its volatility has lessened relative to that of traditional stocks in recent months. ZeroHedge reports that as of October 7th, both Bitcoin and the Dow Jones index of the 30 top industrial equities have been less steady compared to the same day a year prior.

Volatility Cools

BTC prices have tracked those of the stock market in recent months due to the fact that both are vulnerable to the same prevalent macroeconomic concerns, such as rising inflation and interest rates. Bitcoin’s volatility, on the other hand, looks to be calming down.

The 630.15 point drop sent the Dow Jones Industrial Average down 2.1% to 29,296.78. At its lowest point, the S&P 500 index was 3,639.65, a decline of 2.8%. The Nasdaq Composite Index lost 3.7%, closing at 10,652.40, only 0.9% above its annual low.

Despite its reputation as one of the riskiest investments, Bitcoin has just accomplished something that demonstrates its maturing nature. Notably, proponents have claimed that as Bitcoin matures, as a result of increased adoption, the asset would become less volatile and trade in the same way as other assets.

Bitcoin’s decline from record highs over the past few weeks has caused the asset to stabilize around $20,000, accounting for the change in volatility. After a strong bull run that reached an all-time high of about $68,000 in late 2021, the current price level is being seen as a temporary bottom for Bitcoin.

Rising Dollar Prices Fostering Bitcoin Adoption

Simultaneously, Bitcoin’s reduced volatility has developed in the aftermath of a strong dollar, which caused global fiat currencies to lose value relative to the U.S. currency. A rising dollar has the potential to have a negative impact on stock portfolios, much as falling commodity prices.

The current price level is being seen as a temporary bottom for Bitcoin. Simultaneously, Bitcoin’s reduced volatility has developed in the aftermath of a strong dollar, which caused global fiat currencies to lose value relative to the U.S. currency.

Meanwhile, Bitcoin‘s price remains stable below $20,000 as bears and bulls battle for dominance. As of the time of this writing, the asset was trading for $19,521, up 1% from its previous day’s close.

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