What looks like a tech stock and acts like a tech stock but isn't a tech stock? The answer, increasingly, is Bitcoin—at least when it comes to its market value.

The price of the cryptocurrency is more correlated with share prices on the tech-heavy Nasdaq stock index than at any point since July 2020. According to a new report from Arcane Research, the 30-day correlation between Bitcoin and Nasdaq is 0.70.

Correlation is measured on a -1 to 1 scale, where -1 means the prices always move in opposite directions and 1 means they are in perfect synchronization. A 30-day correlation smooths out some of the day-to-day noise by using a longer time horizon.

While Bitcoin is increasingly correlated with risk assets like Google and Tesla stocks, it's moved into a negative correlation with gold. It's -0.45 is right around an all-time low point. In August 2020, BTC-to-gold hit an all-time high, though the pair has historically fluctuated between positive and negative correlations, providing little guidance to market speculators.

Chart showing correlation between Bitcoin and Nasdaq prices
Correlation between Bitcoin, Nasdaq, gold

The price of gold has traveled from $1,805 per ounce at the beginning of 2022 to $1,952 today, per data from Monex; it's remained roughly static over the past month. Since the start of the year, Bitcoin has gone from $46,730 in value to $41,326, according to data from CoinMarketCap; it's also even for the month, but has experienced sharper volatility than gold.

Ironically, Bitcoin is often referred to as "digital gold" because some proponents see it as a hedge against inflation. 

Inflation is certainly at play in today's markets. The most recent U.S. Consumer Price Index, published by the Bureau of Labor Statistics, put annual inflation at 8.5%—the highest it's been since Ronald Reagan's first term. That means that consumer items cost more than they did a year ago; the dollar doesn't go as far. 

Neither, it seems, do Bitcoin or equities. After a stellar 2021, the Nasdaq is down 13% on the year. No surprise that that's almost the same as Bitcoin, which has lost nearly 12% of its value.


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