What to know:
- Ah, stocks—the grand puppeteers of the crypto stage, or so the report claims.
- Citi, in its infinite wisdom, suggests that as digital assets gain traction, the once tight-knit bond between equities and bitcoin may loosen like a poorly tied shoelace.
- With the U.S. finally deciding to play nice with crypto regulations, expect more price action that resembles a cat on a hot tin roof rather than a steady march of the macroeconomic soldiers.
In a revelation that may shock absolutely no one, Wall Street’s own Citi (C) has declared that the once-cherished relationship between stocks and crypto is likely to weaken in the coming years. Who would have thought?
While equities have strutted about as the most significant macro driver of the crypto realm, the report suggests that this “equity-crypto correlation” might just fade away like last season’s fashion. As the asset class matures—yes, it’s growing up—its investor base expands, technology advances, and adoption progresses, we might witness a delightful unraveling.
Yet, let us not forget the whimsical nature of cryptocurrency markets, where risk asset correlations can inflate like a balloon at a child’s birthday party, especially during those oh-so-fun risk-off events.
“A more transparent regulatory regime in the U.S. will also lead to more idiosyncratic price action,” the analysts, led by the ever-astute Alex Saunders, have proclaimed. Because who doesn’t love a little unpredictability in their financial life?
As for Bitcoin (BTC), its volatility is expected to take a leisurely stroll downward in the long term, thanks to the growing institutional adoption. How quaint!
Citi also pointed out that crypto was the only asset class whose market cap, as a percentage of U.S. equities, grew last year. A true underdog story, if there ever was one!
And let’s not overlook Bitcoin’s budding relationship with gold, which may just be the early signs of its “store of value use case.” Because, you know, nothing says stability like a digital currency that can swing wildly in value!
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2025-02-05 11:54