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According to Arcane Research, bitcoin’s dependence on the US stock index Nasdaq is at its lowest level in 2022. However, analysts of the International Monetary Fund point to the increasing correlation of digital currencies and Asian markets.
The IMF study states that in the Asia-Pacific region, cryptocurrencies are rapidly integrating into the traditional financial system. Bitcoin and other virtual currencies move along with indicators of business activity, and this trend creates risks for the stability of the regional economy.
The main threat to the financial sector of the Asia-Pacific region comes from those investors who invest simultaneously in traditional assets and cryptocurrencies. In India, for example, the correlation between bitcoin and local stock indicators has increased tenfold during the COVID-19 pandemic.
Both institutionals and retail investors enter the cryptosphere in Asia. Moreover, the latter since 2020 have significantly increased investments in such instruments, the IMF emphasized.
The correlation between the cryptocurrency and traditional markets is increasing in almost all Asian countries, but the fastest rates are observed in India, Vietnam and Thailand.
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