Bitcoin Tied to Stocks as Rate-Hike Expectations Rise
Bitcoin's price movement may be closely tied to that of the stock market as expectations for higher U.S. interest rates grow.
Mike McGlone, senior commodity strategist at Bloomberg Intelligence, observed that federal funds futures are currently pricing in about 50 basis points of rate hikes over the next year, a scenario in which Bitcoin typically declines.
McGlone noted that Bitcoin often recovers after the rate-futures market shifts back toward easing, and suggested that one of the strongest factors driving this shift could be a decline in the stock market.
In his view, metals or digital assets are unlikely to rise broadly on their own during a stock-market decline. He also stated that gold, Bitcoin, and stocks have all shown extreme price moves recently, with the sharp market swings seen on September 3 unlikely to continue unchanged through year-end.