SPDR S&P 500 (SPY)

[jbsliverer]

The future outlook
https://www.nbcnews.com/business/markets/bitcoin-whats-going-on-explainer-rcna28097#anchor-Warningstoexercisecaution

While it is now clear that bitcoin is not an inflation hedge or safe haven asset, he said, "For a lot of people, it will provide a long-term value. Its ecosystem will provide the next wave of innovation."

But exactly when the bets on that ecosystem will pay off is now an open question. In the meantime, bitcoin holders — especially those newer to the market — are taking heavy losses. According to data reported by Bloomberg, short-term bitcoin holders bought into the digital currency at an average price of $47,500 — meaning they are now firmly in the red.

The notion that bitcoin should be considered a risk asset correlated with some of the edgier names in tech was echoed this week by Coinbase, one of the largest cryptocurrency brokerages. Coinbase has seen its shares plummet almost 80 percent from a high of $323 in November 2021 to about $68 — including an approximately 20-percent drop Wednesday.

"We're seeing a down market for growth tech stocks and risk assets," said Coinbase CEO Brian Armstrong during the company's most recent earnings call. "And of course, Coinbase and crypto is no exception to that."

And like those more volatile tech stocks, bitcoin is proving highly sensitive to interest rates. When money is more expensive to borrow, investors are less likely to invest in riskier bets on the future like bitcoin. So, as interest rates rise, bitcoin's price is more likely to fall.

Dantes of CoinDesk said bitcoin prices also fell in 2014 and 2018 amid a less accommodative monetary stance from the Federal Reserve.

"We're now in a moment of high inflation and tightening monetary policy, so we expect lower returns for all assets going forward," he said. "And if we're lower returns on traditional assets, we're going to see extremely low returns for speculative assets."