Bitcoin Appears Soft in Era of Hard Assets for Hedging Inflation

    According to Bloomberg News, the negative correlation of Bitcoin with commodity markets is a cause of excess fodder for the critics related to its suitability as an inflation hedge

    The hedging inflation

    If a 50-day coefficient for Bitcoin and gold is considered, it is approximately minus 0.4, the lowest since 2018. In contrast, a standard measure for the Bloomberg Commodity Spot Index and the token is negative and at a multi-year nadir. A reading of 1 indicates that assets are moving in lockstep, and minus 1 implies the reverse. 

    As such, while the demand for the portfolio is seen to buffer against the price pressures catalyzed commodity performance in the current year, Bitcoin has moved the other way. 

    According to a senior market analyst associated with Oanda Asia Pacific Pte, Jeffrey Halley, it is pretty likely that Bitcoin is tested during high inflation, rising rate environment, the first time, and the investors are opting for tradition against a new frontier. He also stated that gold had been an inflation hedge for the millennia. 

    The advocates of Bitcoin remain unmoved, arguing that the digital currency will prove how worthy it is with time and partly thanks to the capped supply of as many as 21 million tokens. 

    Founder of MicroStrategy Inc., Michael Saylor, stated in a recent interview on Bloomberg Television that he cannot think of anything better to place the company during an inflationary environment than to change the balance sheet into Bitcoin. 

    As for the present, Bitcoin remains tightly correlated to NASDAQ 100 index, and investors have dumped the token and the technology-heavy gauge in 2022 out of fear that the stringent US monetary policy might hurt investors’ risk-taking appetite, reports Bloomberg News. 

    The NASDAQ 100 is down by about 15% this year, whereas the largest cryptocurrency in the world has dropped by 16%. As of 11:55 am in London on Monday, the token plunged by 3.3%, falling to a one-month low of approximately $39,000. 



    RELATED ARTICLES

    assets safer than cash

    8 Assets Safer Than Cash: Protect and Grow Your Wealth

    Cash offers convenience and liquidity but lacks when it comes to wealth preservation and growth....
    Penny Stocks on Robinhood

    All Things You Need To Know About The High Net Worth Estate Planning

    High networth estate planning can be complicated and challenging, especially if you are a high-income...
    Assets that are making people rich

    11 Powerful Assets That Are Making People Wealthy

    Do you want to know the secret to building wealth? It's straightforward—assets. Powerful Assets bring...
    PayPal

    PayPal: How PayPal Brief Outage Impacted the Users

    PayPal is one of the major payment platforms which facilitates online transactions of millions of...
    Psychology of money

    Mastering Money: Lessons from The Psychology of Money to Transform Your Financial Future

    Morgan Housel's The Psychology of Money goes beyond numbers and investment tactics. It digs deep...
    Bitcoin hold

    Bitcoin Hold: How Crypto Policy by Trump Shaped the Market

    Bitcoin is the most valuable and popular cryptocurrency in the world. BTC (Bitcoin) has been...
    assets safer than cash

    8 Assets Safer Than Cash: Protect and Grow Your Wealth

    Cash offers convenience and liquidity but lacks when it comes to wealth preservation and growth....
    iBOMMA

    iBOMMA – Is iBOMMA Safe for Watching and Downloading Movies in 2025

    iBOMMA is a website that is known to have a lot of good movies and...
    how to do keyword research

    How to Do Keyword Research: Guide You Really Need in 2025!

    Are you planning to open a website but worried if you have the right Google...
    Trump and Elon

    Trump and Elon Interventions: The Growing Alliance 

    The alliance between Trump and Elon Musk has been a topic of discussion in recent...
    ClickUp

    Clickup: What Is It, and How Does It Work?

    Sometimes, your daily chores feel like a maze with stacked grocery lists, and you end...