(CoinDesk) Bank of America says Bitcoin cannot be an inflation hedge until it sheds off the volatilities, which are still elevated compared to Gold and major stock indices.
BofA says Bitcoin has traded as a risk asset since July, noting that the correlation between the largest cryptocurrency and Gold, which is regarded as a store of value, has remained close to zero since June.
Strategist Alkesh Shah says as of January 31, correlations between Bitcoin and S&P 500, as well as Nasdaq 100, hit an all-time high and the 99.73 percentile, respectively.
BofA still acknowledges that Bitcoin’s volatility has fallen from its 2013 highs, although it still remains high to be taken as an inflation hedge by investors in developed economies. The strategist says the cryptocurrency can still be a favorable inflation hedge in inflationary environments.
BTCUSD is up +0.34%.
