“In Times Of Crisis, Correlations Go To 1”
Quarter 2 draws to a horrendous close as the seemingly ever-worsening macro backdrop continues to plague and be an anchor to risk asset prices. Due to the “perfect macro storm”, crypto assets (being furthest out on the risk curve) have had a torrid 8 months.
Remember, the “perfect macro storm” is the current combination of:
- Multi-decade high inflation prints
- Rising interest rates (and more importantly, the downstream effects that an increased cost of capital entails)
- Continued worsening liquidity conditions across asset classes
- Continued strong dollar
Because of these things, unfortunately, “Bitcoin Is Behaving Like It Should”. Remember, “Bitcoin is one of the purest plays on fiat currency debasement.” While this below twitter thread is from January, it did a fantastic job of describing many of the dynamics that are now currently at pl
