Bitcoin is a macro asset as it is now part of the global market. But not all macro assets are highly correlated. When the fear subsides (which it will one day), given the different value propositions of equities and crypto, we’ll likely see correlations return to lower levels, supporting the narrative of an “alternative” macro asset. Even before that, as the dust settles on recent crypto crashes, the outlook for global equities continues to deteriorate, and the risk of holding dollars rises, we could see investors calibrating the relative disadvantages of asset groups. The resulting cash flows are likely to change correlations and narratives, creating new dynamics that will further impact correlations.
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