The cryptocurrency market continues to be in a bearish phase, but bitcoin accumulation continues.
The bitcoin price, as well as the Nasdaq Composite Index, with which it is firmly correlated, are in a bearish phase. For example, at the end of 2021, bitcoin was worth $47,000, which was 32% less than its all-time high. At the same time, the Nasdaq Composite was at 15,650 points, just 3% below the all-time high for the exchange. Since then, bitcoin has fallen 57% to $20,500 and the Nasdaq Composite has lost 24.4%.
You can see that bitcoin is falling “more than the Nasdaq Composite,” but the high volatility means that if Wall Street rises, bitcoin prices will accelerate more, which leads investors to conclude that if they invest in stocks of Nasdaq Composite companies in anticipation of a market rebound, they should also put bitcoin investments in their portfolios.
In the case of stocks of companies from Nasdaq Composite, and the largest of them are Apple, Microsoft, Tesla, Google and Nvidia, the growth of their rates may be due to an improvement in their financial performance. However, there is a nuance here that plays in favor of bitcoin investments.
The fact is that any companies issuing shares can potentially conduct an additional issue of these securities, and the volume of this issue is difficult to predict several years before the possible event. In the case of bitcoin, however, the volume of its maximum possible supply can be predicted many years in advance.
In addition, the exposure of the stock market to regulation is more sensitive than in the case of bitcoin. For example, Nvidia shares had fallen to their lowest in 68 weeks by the beginning of the week, as U.S. officials announced new requirements to obtain permits to export the corporation’s chips from the U.S. to China.
In the case of bitcoin, bitcoin’s hash rates and mining sophistication adapt to any changes in regulation, such as bitcoin mining in China, Iran or the United States. As a result, the cryptocurrency’s No. 1 blockchain remains stable, and bitcoin mining itself attracts investment, including in the stocks of mining companies that trade in New York and London.