The shifting relationship between Bitcoin and US equities is prompting inquiries regarding its function as a global safe-haven asset during times of financial turmoil.<\/p>\n
Bitcoin (BTC<\/a>) displayed a robust negative correlation with the US stock market when considering the short-term, seven-day trailing correlation, as indicated by recent findings from blockchain data provider RedStone Oracles, released exclusively to Cointelegraph.<\/p>\n Nonetheless, RedStone indicated that the 30-day metric showcases a \u201cvariable correlation\u201d between Bitcoin prices and the S&P 500 index, with the correlation coefficient fluctuating between -0.2 to 0.4.<\/p>\n This unpredictable correlation implies that Bitcoin \u201cdoesn\u2019t reliably act as a true hedge for equities,\u201d due to its insufficient strong negative correlation below -0.3, which is essential for \u201ceffective counter movement during market stress,\u201d the report noted.<\/p>\n Related: <\/strong><\/em>$1B Bitcoin exits Coinbase in a single day as experts caution of supply shock<\/strong><\/em><\/a><\/p>\n According to the research, while Bitcoin may not serve as a reliable hedge against declines in the stock market, it does provide utility as a portfolio diversifier.<\/p>\n This shifting dynamic suggests that Bitcoin frequently moves independently from other assets, potentially delivering extra profits while other assets are underperforming. However, Bitcoin has yet to reflect the safe-haven characteristics of gold and government bonds, RedStone indicates.<\/p>\n Related: <\/strong><\/em>Nasdaq-listed GDC intends to purchase Bitcoin and TRUMP memecoin for $300M<\/strong><\/em><\/a><\/p>\n Although Bitcoin is set to develop into a safe-haven asset in the forthcoming years, the pioneering cryptocurrency still requires to \u201cmature\u201d as a global asset, as articulated by Marcin Kazmierczak, co-founder and chief operating officer at RedStone.<\/p>\n \u201cBitcoin still needs to mature before detaching from stock markets,\u201d Kazmierczak informed Cointelegraph, elaborating:<\/p>\n \u201cIncreased institutional acceptance will certainly assist \u2014 we\u2019re already observing this impact with corporate treasury investments diminishing Bitcoin\u2019s 30-day volatility and with BlackRock consistently endorsing BTC as an asset in a portfolio.\u201d<\/p><\/blockquote>\n In the meantime, Bitcoin will gain increasing acknowledgment as a portfolio diversifier, boasting an annualized return exceeding 230% over the past five years, which has \u201csubstantially outperformed\u201d both stocks and traditional safe-haven assets, Kazmierczak stated, adding that \u201ceven a modest 1\u20135% Bitcoin allocation can significantly improve a portfolio\u2019s risk-adjusted returns.\u201d<\/p>\n Simultaneously, Bitcoin\u2019s decreasing volatility underscores BTC\u2019s advancing maturity as a global financial asset. <\/strong><\/em>Bitcoin\u2019s weekly volatility<\/a> reached a 563-day low on April 30, a development that may indicate more stable price movement.<\/p>\nBitcoin must \u201cmature\u201d before detaching from the stock market<\/h2>\n