Broker Canaccord pointed out in a report on Monday that Bitcoin has outperformed the S&P 500 in the past year. It also pointed out that Bitcoin’s decline may be a healthier behavior for the entire cryptocurrency market. And said that Bitcoin may have a potential rebound from now to April next year.
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ToggleIt’s time for a rebound until April next year. Bitcoin has led the market in the past year
Broker Canaccord pointed out in the report that mainstream cryptocurrencies continue to lead the market. He said: "Bitcoin, the largest cryptocurrency by market capitalization, increased by approximately 140% annually last quarter. It outperformed Ethereum, which increased by 60% annually, and Ethereum, which increased by 30% annually. % of the S&P 500.”
He also pointed out that if Bitcoin follows the old pattern, it will usually rebound within 6 to 12 months after the halving and reach an all-time high after 2 to 6 months, which means that it is possible from now to April next year. The timing of the rebound. The Bitcoin halving time this time falls on April 20, and the estimated period of 6 to 12 months is also close. However, what is different from the past is that this round reached historical highs long before the Bitcoin halving.
Analyst: Bitcoin’s fall is better for the overall market
Broker Canaccord also said that the Federal Reserve's two-digit interest rate cut will bring stocks and cryptocurrencies up together. Analyst Michael Graham said that Bitcoin's current performance is still consistent with other risk assets and has a positive response to the low interest rate environment.
Michael Graham said: "We believe that the healthiest response to cryptocurrencies in the long term is a decline in Bitcoin," adding: "Given the reduced need for inflation hedges, investors will be more willing to support long-term investment and innovation . Ethereum and other digital assets will rise along with stocks.”
The report pointed out that the current correlation coefficient between Bitcoin and risky assets is 0.4, which is lower than the historical high of 0.6 in June 2022. At the same time, the supply of stablecoins increased by 7% in the third quarter, which is solid good news for the market. At the same time, the report also mentioned that although the timing of future interest rate cuts is still uncertain, the dynamic adjustment of supply and demand caused by the Bitcoin halving will further promote ETFs.
As for whether Bitcoin is a risky asset? Or maybe it is a safe-haven asset just like his positioning of digital gold. Judging from the trend, it may be difficult for us to identify it as a safe-haven asset because it is still highly correlated with the broader market. However, as BlackRock’s report stated, Bitcoin has “relatively” not fallen as badly as the S&P 500 in some events, but coupled with some factors, BlackRock believes that Bitcoin is not just a safe-haven asset.
( Is Bitcoin a risky asset? BlackRock rebrands Bitcoin as a "unique diversification tool" )
