Since February, when Donald Trump officially announced his aggressive tax plan, the US economy has fallen into a volatile state. That month, the S&P market was valued at $5,969.58. Since then, the market has dropped by at least 9.5%. Similarly, the Nasdaq 100 index has fallen by more than 12.14%. Surprisingly, Bitcoin - often seen as a hedge against market instability - followed the US stock market trend during this period, dropping around 18.49%. Meanwhile, gold increased by more than 10.47%, sparking heated debates about whether Bitcoin is truly an independent asset.
Michael Saylor, co-founder of Strategy, believes that the correlation between Bitcoin and the US stock market is only a temporary phenomenon. He explains that Bitcoin's high liquidity and 24/7 trading capability make it a convenient asset to sell during market downturns. Saylor emphasizes that the short-term correlation does not mean Bitcoin is tied to the stock market in the long term and can still be an uncorrelated - independent asset.
Despite short-term concerns, in 2024, the Bitcoin market recorded an impressive growth of 121.1%. In the same year, the S&P 500 index only increased by 24.05% and the Nasdaq 100 only grew by 27.10%. The gold market during this period only achieved a growth of 27.54%. This shows that although Bitcoin may be volatile in the short term, its long-term potential remains unaffected. Discussions about Bitcoin's market behavior continue, and despite short-term volatility, its long-term potential is not diminished.
