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Think about what happened to crypto and other inflation hedges in march 2020. They got ahnilated worse than equities in the initial risk off and then out perfor
by anm89 5y ago
Think about what happened to crypto and other inflation hedges in march 2020. They got ahnilated worse than equities in the initial risk off and then out performed ever since.
I think that's where we are now. If there is a market sell off, crypto is along for the ride initially. the question will be what it looks like from there.
- opportune 5y agoI don’t think this deserves to be downvoted. Crypto is an asset class. During uncertainty and sell offs almost all assets sell off in tandem due to either deleveraging or flight to safety (of cash), and crypto isn’t special here. Over long horizons, the argument that crypto is a hedge against inflation or weakened purchasing power of fiat currency makes sense. But during acute corrections that matters very little, especially since very few people are actually paying for real world goods using crypto.
- listenallyall 5y agoInflation wasn't a problem in March 2020 -- at least it wasn't a primary concern at that time. As you said, first crypto sold off (just like stocks) and then rallied aggressively for the next 20 months or so (just like stocks). Bitcoin's entire existence has been during a major extended bull rally in stocks -- it's never been tested during a market crash or bear market like 1999 or 2008.