Bloomberg Intelligence Says Crypto Faces ‘Catch-22’ Amid High Correlation With Stocks
Summary
- Bloomberg Intelligence said the cryptocurrency market could be vulnerable because of its high correlation with the stock market and its volatility.
- Mike McGlone, senior commodity strategist at Bloomberg Intelligence, said the crypto market is in a catch-22 situation.
- He said a decline in the stock market could deepen losses in crypto, while high volatility could remain a burden even if stocks rise.
Forecast Trend Report by Period
The cryptocurrency market may be vulnerable regardless of which way stocks move because it is highly correlated with equities and subject to greater volatility, according to Bloomberg Intelligence.
On Sept. 20, Mike McGlone, Bloomberg Intelligence’s senior commodity strategist, said the crypto market is caught in what he called a “catch-22.”
He identified crypto’s strong correlation with stocks, coupled with higher volatility, as a key risk factor.
As a result, crypto losses could deepen if the stock market declines. Even if stocks rise, high volatility could still weigh on the market.
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