Bitcoin (BTC) remained close to a weekly low on March 7, when investors’ journey to safety did nothing for the cryptocurrency.
Hourly BTC/USD light chart (Bit Mark). Source: Trading View
Gold and the dollar mean bad times for stocks
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD jumped to around $37,600 overnight before rallying back to around $1,000.
The pair faced pressure from a weekly shutdown that hit lows this month amid reports that Western sanctions on Russia could be expanded to include an oil embargo.
As such, the apocalyptic weather has already seen safe harbor gold return to $2,000 an ounce for the first time between August 2020 and March 7.
XAU/USD for a week. Source: Trading View
In turn, the US dollar, which rose in front of its peers to see the US Dollar Currency Index (DXY), reached the 100 target in almost two years.
Other major global currencies, such as the euro, pushed up the price, with EUR/USD dropping below $1.09 to the lowest level not seen since the COVID-19 crash in March 2020.
US Dollar Currency Index (DXY) on the weekly chart. Source: Trading View
“If bitcoin had not been tied to the stock market, it would have behaved like gold since December,” analyst Matthew Hyland said in a March 6 review.
“Bitcoin is tied to the stock market. It hasn’t “lost consciousness.” Maybe one day it will shut down, but before that happens, you can’t conclude that it’s closed or will.”
This “decoupling” has undoubtedly been more necessary than ever in recent times, with stocks themselves facing a potential combination of very high commodity prices and anti-inflation measures by governments.
Before the Wall Street launch, S&P 500 futures were down 2% and the German DAX was already down 4%.
Blankfein, ex-chairman of Goldman Sachs: Cryptocurrency must ‘hold up’
Meanwhile, the weakness of Bitcoin has caught the attention of the traditional financial world.
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Lloyd Blankfein, the former CEO of Goldman Sachs, questioned why cryptocurrencies in general have not seen more inflows amid government controls on funds.
“Keeping an open mind on cryptocurrencies, but given the appreciation of the US dollar and the strong reminder that governments can and will, under certain circumstances, freeze accounts and block payments, don’t you think crypto is about to have a moment now? Don’t you see it? So far in terms of Value,” he tweeted on March 7.
In response, MicroStrategy CEO Michael Saylor specifically blamed the controversial Bitcoin investment profiles, but predicted that the status quo would eventually collapse and allow it to serve its long-term investment function.
“There is tension between ordinary traders who see bitcoin as something to buy or sell depending on their current assessment of risk and interest rate expectations, and fundamental investors who just want to buy everything and hold it forever,” he wrote.
“In time, the scammers will win.”