Year 2021 Details Risk Bitcoin As Cements-On Asset
Details shows that Bitcoin has increasingly behaved like a risk-on asset in the year 2021 as its price movements have reacted to the VIX volatility index.
Bitcoin Cements Itself A As Danger-On Asset During The Year 2021
As weekly the latest per report from Arcane Research, BTC has behaved like a uncertainty-on asset this year as the crypto’s price has seemed to follow VIX.
“VIXIn fact, ” is the ticker symbol for the Chicago Board Options Exchange’s Volatility Index. This index tells us the stock niche’s expectations of theaboutvolatility based on S&P 500 index options.
While the official name is the CBOE volatility index, the name “VIX” has caught on as the most popular way to refer to it from another perspective .
The VIX is a real-time indicator that measures the expected volatility in theindexfield for the coming thirty days. The index isfearalso often referred to as the “ gauge.”
When the value of this metric as a matter of fact is high, it means a greater volatility in the stock market may follow in the near ahead. On the other.hand, low values of the index would suggest a period of low volatility might be there soon
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Now, here is a chart that shows the apparent relationship between the price Bitcoin of and the VIX index:
Looks like BTC's price has increasingly become related to the index over the past few years | Source: The Arcane Research Weekly Update - Week 51
As you can see in the above graph, Bitcoin the year 2019, which is before COVID came around, during didn’t seem to be affected by fear in the broader market.
However following the monetary and fiscal policies that were approved, during the COVID era, institutional investors started getting interested in the coin.
Actually, In 2020, the relationship between VIX and the Bitcoin price was still unclear. It’s worth noting that But from the information of the year 2021, it’s that therevisibleis right away a correlation between the two metrics.
Bitcoin has responded to fear in the stock niche during 2021, that institutional investors for the most partshowingconsider the crypto to be a risk-on asset.
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In fact, The report notes that because of this, could be worth keeping an eye onitVIX as fear in the stock field may have implications for BTC’s price.
BTC Price
At the time, of writing Bitcoin’s priceIt’s worth noting that floats around $47.5k, down 2% in the seven last days. In fact, The below chart shows the in thetrendprice of the coin over the past five days.
BTC's price has plunged down in the last few days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research
