The most common way to describe bitcoin is “digital gold.” It’s this simple, compelling catchphrase that’s allowed bitcoin to reach the far corners of the world.
It will gradually fall into this role, so it follows that the bigger bitcoin gets, the more it should function as a gold-like asset, i.e., trade with some relationship to real interest rates, which determine the demand for a non-yielding store of value asset.
The correlation with real rates should get more inverse, and with gold more positive.
Bitcoin’s correlation with real rates and gold is now the most out of whack it’s ever been, which means the story people are giving for buying it is less true than it’s ever been.
Yes, bitcoin can go through periods of adoption that are completely uncorrelated to anything else, but the fact there is no discernable progress in bitcoin’s relationship with real rates or gold over the past decade is damning evidence that no matter how popular the coin gets, no one’s treating it like gold.
New York time.The Stoxx Europe 600 Index gained 0.2%.The MSCI Asia Pacific Index advanced 0.7%.CurrenciesThe Bloomberg Dollar Spot Index fell 0.2%.The euro climbed 0.3% to $1.1979.The Japanese yen appreciated 0.2% to 108.89 per dollar.BondsThe yield on two-year Treasuries rose less than one basis point to 0.16%.The yield on 10-year Treasuries rose two basis points to 1.63%.The yield on 30-year Treasuries climbed two basis points to 2.31%.CommoditiesWest Texas Intermediate crude gained 4.5% to $62.89 a barrel.Gold weakened 0.5% to $1,736.65 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
It was the scene of a dramatic “flash crash” last year when the yield program was announced, illustrating the potential for turmoil.While the Reserve Bank of Australia has largely tamed markets since then, as the economy’s recovery strengthens, wagers against the RBA’s ability to keep yields lower look poised to rise.“If inflation expectations do start to un-anchor, then I think the RBA will be one of the first central banks to be tested by bond traders,” said Shaun Roache, an economist at S&P Global Ratings in Singapore.
. The company will get access to five new credit facilities; the state will buy an ownership stake of more than 5% and receive 14.6 million warrants to buy more shares.“In spite of the dilution that we see, we still see a path for this company to be worth, at least, in excess of C$40 when the Covid situation and the airline situation normalizes a bit more,” Paul Younes, an analyst at Montreal-based Letko, said in an interview on BNN Bloomberg Television.
Fund managers are trimming exposure to Russia and Ukraine on fears that years of tensions could finally erupt into outright war, bringing economic ruin for Ukraine and more sanctions on Russia.
As Coinbase, the cryptocurrency exchange, goes public on Wednesday, financial advisers want you to remember the difference.