With interest rates rising in the U.S. the way they have been thanks to a hawkish Federal Reserve, it’s difficult to oust the almighty greenback. However, bitcoin is still outperforming certain currencies around the globe even with the recent pullback.
It’s not just emerging market currencies that bitcoin is outperforming. It’s also economic powerhouses of developed countries such as Great Britain and China.
“As currencies including the British pound and Chinese yuan tumble, Bitcoin has bucked the trend, growing 6.3% over the past seven days and flirting with $20,000,” a Fortune magazine article noted. “Macro conditions, including rising inflation and fiscal uncertainty, have battered global markets. Even though Bitcoin has largely conformed financial swings, its strong performance over the past week has shocked some traders and underscored the turbulent times.”
Bitcoin has exhibited less volatility over the years as the asset has matured. The influx of institutional money has also helped to keep the leading cryptocurrency relatively stable when compared to its early years of adoption.
The byproduct of this, however, is an asset that now moves more in tune with traditional markets. Bitcoin has been exhibiting more correlation with the stock market, particularly this year, but it’s a long way from its early volatility days.
“You know we’ve reached a unique time in history when #Bitcoin suddenly is less volatile than fiat currencies,” tweeted Henrich, founder of the markets research firm NorthmanTrader.
Getting Actively Managed Bitcoin Exposure
Investors who want to get bitcoin exposure and to avoid investing via a cryptocurrency exchange can opt for the ProShares Bitcoin ETF (BITO ). The fund provides exposure to bitcoin futures, tailing the price movements of the leading cryptocurrency on a normal market exchange.
BITO certainly played a large role in catapulting bitcoin to its November all-time high with it becoming the first U.S. exchange traded fund (ETF) to focus on the leading cryptocurrency. While crypto purists may be skeptical about a futures ETF, it can work for investors looking for alternate exposure.
Furthermore, the fund is actively managed, giving investors the peace of mind of knowing that their investment is in the hands of seasoned portfolio managers. Bitcoin can be a volatile asset, and active management can make portfolio changes on the fly when market conditions warrant an adjustment.
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