A new article published by the Wall Street Journal (WSJ) magazine is in the Bitcoin news today, suggesting that the correlation between Bitcoin and traditional assets markets has been high in recent days.
The article pulled data from the research firm Excalibur Pro Inc. in which the WSJ states that Bitcoin has traded at a 0.84 correlation to gold over the past five days where -1 indicates complete inversion and +1 indicates perfect correlation.
WSJ also shows why this kind of a pattern formed. The first reason for that is the reported influx of institutional money into the crypto and blockchain space, especially the Grayscale Investments’ over-the-counter exchange-traded fund (ETF) as a prime example. The article also shows that this trust saw $51 million in assets under management during its first year (2013) and by the end of last year, it surged to around $3.5 billion.
Another crucial factor is the venture capital (VC) investment which was around $96 million in 2013 and grew to $500 million in 2016 and to over $2 billion in all-time VC crypto investments by the end of 2017.
The WSJ report also noted that a major pull factor for traditional capital into crypto is the building of trading services and infrastructure with high regulatory compliance, the crypto futures trading market and the attempts to gain broad acceptance for crypto-based ETFs.
As reported, new major developments on the horizon could be the launch of the Bakkt Bitcoin futures exchange, the launch of investment giant Fidelity’s digital assets business and the influx of stalwart investors including the names of Yale, Harvard and Stanford Universities.
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