Could the increase in bitcoin activity be related to Nasdaq’s slowdown? This issue is at the core of recent findings by renowned crypto experts Chris Burniske and Yann Allemann, the co-founder of Glassnode.
In a recent tweet, Burniske shared a fascinating observation, observing that crypto frequently gains momentum when Nasdaq (NDX) stops. This pattern shows that during times of weak Nasdaq performance, investors may be shifting their money towards riskier assets, such as cryptocurrency.
Allemann has monitored this pattern since the year 2019. He pointed out that the Nasdaq-100 needed 186 days to recapture the 7,600 level, which was a barometer for prerecessional anxieties.
The biggest and best-known cryptocurrency, Bitcoin, took almost 220 days to reach the $6,500 mark. However, after Bitcoin began to rise, Allemann’s analysis showed that it significantly outperformed the Nasdaq.
Burniske suggested a potentially risky “waterfall,” where investors would shift from Nasdaq to Bitcoin and subsequently to other digital assets including Ethereum (ETH), Solana (SOL), Dogecoin (DOGE), and non-fungible tokens (NFTs).
In this fictitious development, investors would put their money into more risky and speculative investments.
The present market seems to be supporting this tendency. Allemann brought out the fact that Nasdaq has taken a staggering 445 days to reach its April 2022 levels. Bitcoin, on the other hand, has greatly decoupled. If history is any indication, this may mean that investors are looking for higher-risk, higher-reward alternatives, which might mean that Bitcoin and possibly other cryptocurrencies are about to see a huge boom.
