Bitcoin has a zero correlation with stocks once again and critics were wrong to doubt its safe haven status, says Morgan Creek Digital co-founder.
The price of Bitcoin (BTC) “couldn’t be more out of sync” with the stock market, says Anthony Pompliano, as the data shows that BTC is outperforming the macro-assets.
In a series of tweets on Oct. 26, Morgan Creek Digital co-founder, also known as “Pomp,” criticized critics for their accusations that Bitcoin was a poor reserve of value.
Pomp on Bitcoin’s safe haven: “The market is proving it”
Pompliano uploaded a graph from the Santiment behavioral analysis platform, showing that Bitcoin reached 0 for a 30-day correlation with the S&P 500.
“It couldn’t be less correlated than it is now,” he added in comments.
Bitcoin vs. S&P 500 Moving Correlation Chart: Anthony Pompliano/Twitter
Continuing, Pompliano noted that Bitcoin has outperformed the returns of macro assets since the collapse of the Coronavirus in March of this year.
“So how did Bitcoin do during an economic downturn? It outperformed stocks, bonds, gold, oil and just about everything else. It also has little or no correlation over any significant amount of time,” he summarized.
“Bitcoin is the ultimate safe haven and the market is proving it.
At around USD 13,150, the BTC/USD pair has offered investors annual returns to date of 83%, versus 24% for gold and 6% for the S&P 500, confirm the data from the on-chain monitoring resource Skew.
For Pompliano, the above correlation between Bitcoin and these assets was simply a short term phenomenon induced by the March events.
“During liquidity crises, all asset correlations tend to 1. This was a temporary thing and happened to gold, stocks etc.” he wrote.
Bitcoin vs. macro asset performance Source: Skew
No more correlation?
As Cointelegraph reported, a consensus has been building that Bitcoin is not only abandoning its correlation with stocks and others, but that this will be a definitive turning point that will not be reversed.
Among those promoting the idea is Willy Woo, the statistician and creator of the Woobull data resource, who continues to double Bitcoin’s bet on his own sooner rather than later.
“Decoupling is upon us,” he tweeted last week.
“It makes sense that BTC will continue to be correlated in short term trading; but not in the longer term. BTC is a safe haven, only ‘risk’ (which means it is very new) is skewing this fact.