Leading Analyst Jim Bianco Believes Bitcoin Has a Narrative Problem
one in recent twitter threadRenowned analyst Jim Bianco believes bitcoin has a narrative problem after failing as an inflation hedge.
Bianco notes that bitcoin has been trading in lockstep with the S&P 500 futures over the past six months.
This high correlation continues as cryptocurrencies continue to trade alongside stocks.
Bianco believes that bitcoin is really the equivalent of being “a leveraged ES degen”.
“I have argued that it should not be this way, it is, and continues to be so,” the analyst wrote.
Despite lamenting the Federal Reserve’s over-easing monetary policy in the past, Bianco believes that bitcoin secretly hopes to print more money as the riskier asset is under pressure from low interest rates and quantitative easing. forms are beneficial.
According to analysts, this poses a major problem for Bitcoin’s long-term objective.
As U.Today reports, bitcoin recently recorded its worst quarter in more than a decade. Meanwhile, the tech-heavy Nasdaq Composite, which has a high level of correlation with cryptocurrencies, posted its worst quarter since 2008.
In 2022, bitcoin failed to become a safe haven during the market turmoil, confirming the notion that the world’s largest cryptocurrency is, in fact, a risk-free asset.
In May, Bank of America, one of the leading banking institutions in the US, noted that bitcoin was not a viable portfolio diversifier because it performed closely with stocks. Thus, the largest cryptocurrency may not serve as an inflation hedge.
Bitcoin is down more than 69% from its all-time high despite high inflation.