The crypto market and traditional financial markets have differences from the emergence of the former. With the birth of the first cryptocurrency bitcoin (BTC), the financial markets have treated something from another extreme. Very few people understand what the market's insights actually think of bitcoin and other cryptocurrencies. As explained in a blog post for Swan on Monday, Haar said that "virtually no one" has spent time understanding the history or fundamentals of money. For example, they do not grasp the characteristics that made gold historically dominant money: durability, divisibility, recognizability, portability, and scarcity.
By extension, this impairs Wall Street's understanding of Bitcoin – which is often referred to as "digital gold" for possessing these qualities even more strongly. Haar argues that bitcoin has a similar case. He said that considering this fact people who belong to traditional finance have their notions regarding the money's fundamentals history, which is by far influenced by Keynesian economics. This also includes MMT in recent times considering its emergence.
Bitcoin's renewed weakness may be a signal the Fed is set to stick to its path of aggressive tightening. Many traders, including Mobius Capital Partners' Mark Mobius, consider bitcoin a leading indicator for stock markets. When the VIX spikes upward, it means investors are buying significantly more put options – or bearish bets – relative to calls – or bullish bets. A rising VIX represents a higher level of concern, while a declining VIX indicates less market fear and stability.
Wall Street firms help make the economy run, connecting buyers and sellers of securities and lending money to businesses. But their sophisticated trades are often run on creaky old systems. Goldman and others hope they will be able to run faster, less costly, and ultimately more profitable systems based on blockchains.
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