With just over a week remaining until the U.S. elections, market experts are sharing their insights on the potential trajectory of Bitcoin. Matthew Sigel, Head of Digital Assets Research at VanEck, recently discussed Bitcoin’s correlation with the Nasdaq and its status as a safe haven in an interview with CNBC. Sigel acknowledged that Bitcoin’s correlation with the Nasdaq has fluctuated over time. While it has historically had a low correlation, recently it has risen to a level of concern for some investors who prefer lower correlations with traditional risk assets.
Despite this concern, Sigel emphasized that VanEck sees the current setup as highly bullish for Bitcoin and drew parallels to 2020 when Bitcoin experienced low volatility before rallying after the election results were confirmed. He expects that new buyers could enter the market post-election, leading to a significant increase in Bitcoin’s price. Sigel also suggested that a potential post-election U.S. sovereign debt downgrade by Moody’s could further catalyze Bitcoin’s rise.
The discussion then shifted to Bitcoin’s correlation with the dollar and money supply growth (M2) in comparison to gold. Sigel explained that Bitcoin is somewhat of a chameleon in terms of its correlations, making it difficult to predict its short-term correlations with other assets.
The host also questioned whether Bitcoin’s fixed supply of 21 million strengthens its appeal as a hedge against currency debasement. Sigel highlighted that Bitcoin is not solely a U.S. asset but is also being embraced by emerging market nations. He mentioned that BRICS nations, including Argentina, the UAE, and Ethiopia, are incorporating Bitcoin into their government resources. Sigel noted that there is a sense of urgency outside of the U.S. to find alternatives to the irresponsible fiscal policies pursued by the U.S., and countries like Russia are investing in Bitcoin mining and infrastructure projects to settle global trade.
When asked about Bitcoin’s potential price targets of $100,000 and $200,000, Sigel responded affirmatively. He pointed out that previous Bitcoin cycles have seen significant rallies, and even achieving half of the smallest-ever trough-to-peak rally would result in a substantial increase in price. Sigel believes that the period after the election will be a significant catalyst for Bitcoin’s price growth.
It’s important to note that the views expressed in this article are for informational purposes only and should not be considered financial advice. Readers are encouraged to conduct their own thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses incurred.
