A last-ditch plan to cut interest rates again in order to fight stock market declines seems to have bolstered Bitcoin’s value as the cryptocurrency moved above $6000 this morning.
The increase, as reported by William Suberg at Cointelegraph brought Bitcoin back up to its previous levels last weekend before markets saw more red.
“Data from Coin360 and Cointelegraph Markets tracked BTC/USD reaching 24-hour highs of $6,310 on Monday — daily gains of almost 5%,” Suberg writes.
With this in mind, analysts are looking at possible BTC ‘decoupling’ from equity markets.
“Bitcoin has started to decouple from traditional markets, proving that it may act as a safe haven in the ongoing crisis,” writes Nick Chong at NewsBTC, citing remarks by CEO of Bitwise Asset Management Hunter Horsley; Chong describes recent BTC activity compared to the equity markets:
“BTC was up 15% on the day, easily outperforming the American stock market indices of the S&P 500 and the Dow Jones, which have posted slight gains … on the day.”
On a broader level, hodlers are bullish: for instance,Galaxy Digital’s Mike Novogratz made some recent remarks predicting long-term gains: “$BTC will continue to be volatile over the next few months but the macro backdrop is WHY it was created. This will be and needs to be BTC’s year.”
Meanwhile, BitMex spokespersons have cited the resilience of the exchange’s insurance fund for BTC during the recent volatility as a marker of Bitcoin strength.
“The Insurance Fund exists to act as a last line of defence to prevent (automatic deleveraging),” wrote a representative in a BitMex blog post explaining that the fund is meant to prevent “the automatic deleveraging of the positions of profitable traders against liquidated positions to prevent bankruptcy” and that this means losses won’t exceed margins. “On 12 and 13 March, despite the extreme market movement ADL was completely prevented.”
Take all of this into account when tracking BTC’s wild swings – and hold on tight!