As a cryptocurrency trader, why do I worry about the U.S. stock market every day?

“Bitcoin is digital gold.”

“Bitcoin is not pegged to other assets like stocks.”

“Bitcoin is a safe-haven asset, and the future world will be priced in Bitcoin.”

【Original by Shilian Finance】

In the past, digital currencies such as Bitcoin have always been decoupled from other types of assets, and they also have a unique name in the industry, "cryptocurrency circle", which coin speculators use to distinguish themselves from the outside world.

Some people say that Bitcoin is a national disaster. When the country is in turmoil, it can always rise sharply, just like gold is a safe-haven asset; some people say that Bitcoin is decoupled from other assets, so it is a unique individual; some people say that Bitcoin will soar during inflation to maintain its own value, and it is an excellent safe-haven asset...

Bitcoin has been rising amid such speculation, but when the crisis really came, a question arose: Can Bitcoin really be decoupled? Where does people's belief in Bitcoin come from?

Bitcoin is connected to the world

The situation now seems clear. On March 17, local time in the United States, the Trump administration hopes to "immediately" send emergency funds to Americans during the new coronavirus crisis. "Americans need cash now. I mean in the next two weeks." Trump also said, "I seek to send at least $1,000 to each American."

In line with the style of capitalist countries to save the market but not people, it can be boldly assumed that this move is nothing more than to stabilize the stock market, but it failed, and the US stock market was circuit-breakered again. At the same time, although Bitcoin was not greatly affected and still hovered around $5,000, the market has great uncertainty, which comes from the fear of the unknown.

Although many people say that Bitcoin will definitely rise sharply, saying that it has little correlation with other assets, the current short-term decline is only because investors have not found suitable safe-haven assets, which has caused this situation. When everyone discovers the benefits of Bitcoin, Bitcoin will naturally rise again, or even higher.

But I would like to remind everyone that Bitcoin is still closely linked to the world. When the global market plummeted, some people sold their stocks at a loss because they still "fulfilled" their original position: exchanging fiat currency for Bitcoin, and then exchanging Bitcoin for more fiat currency, and so on.

However, the US dollar is still the only global currency. Today, bulk assets, oil, gold, etc. denominated in US dollars have plummeted. Even Bitcoin is priced in US dollars, and there is even a "middleman" in the middle, USDT, which is 100% anchored to the US dollar.

In this way, Bitcoin is completely connected to the US dollar and the US stock market. The crisis of the US stock market is even a crisis of Bitcoin, which well explains why people who trade in cryptocurrencies should always pay attention to the US stock market, because: they can’t be separated from the capital!

Can Bitcoin's dream of getting rich quickly continue?

“The purpose of cryptocurrency trading is to get rich quickly.” said an old friend who has been in the cryptocurrency circle for many years.

Getting rich quickly seems to be the belief of Bitcoin. From 40 bitcoins per pizza in the past to today, Bitcoin is truly a miracle.

At the same time, Bitcoin has also produced some firm believers. While they are making a lot of money, they are also firm believers in Bitcoin during this "war against the epidemic." Although the global economy is declining, it still does not hinder their admiration for Bitcoin, and they also have full fantasies about halving.

Although fantasy is just fantasy after all, and no one knows what will happen when the halving comes, perhaps Bitcoin’s second “opportunity to get rich” has arrived.

Currently, the coronavirus has infected hundreds of thousands of people around the world and there is no sign of a decline. Global panic is also growing, and regulators in various countries have implemented travel bans, which has also caused losses to the entire industry. Some analysts expect that if Bitcoin falls below the $3,000 level, it may even fall to as low as $1,000.

It is worth mentioning that there are some positive factors in the cryptocurrency market: for example, Jack Dorsey, the CEO of Twitter, who is known as the most hardcore Bitcoin fan on the West Coast of the United States, is going to enter the banking industry, and his Square has been approved to open a bank in 2021. He previously said in an interview with The Times that he expects Bitcoin to become the only global currency in the next decade. Twitter even released a Bitcoin emoji that will be displayed every time the hashtag #bitcoin is entered.

Vitalik also released the ETH 2 roadmap for the next 5-10 years on Twitter, pointing out that the roadmap only reflects my own views and the details may change as new information or new technologies are discovered.

Today, there is no asset that is completely safe-haven and guaranteed to appreciate in value, and we don’t know when the epidemic will end. But one thing is certain: after the epidemic is over, Bitcoin will most likely rebound sharply to at least $7,000. This means that this may be a good opportunity to buy some “discounted” Bitcoin now, and you may just have to wait for it to appreciate in value in the future, and you may even have your name added to the list of bigwigs.

This article is original to Shilian Finance, author: Broccoli, unauthorized reproduction is prohibited

This article only represents the author's views and does not represent the official position of Shilian Finance