The FTX crash and related events did more to push the bitcoin (BTC) price up or down through Q4 2022 compared to macroeconomic events like rate hikes.according to research.
In the “State of Bitcoin Q4 2022” report published on Feb. 10, Messari research analysts Sami Kassab and Chris Collar found that the exchange’s collapse resulted in a 25% decline in the price of Bitcoin.
how did #Bitcoin fare in Q4 22′ in the wake of unfavorable macro and crypto environments?
+FTX collapse caused a 25% swing, affecting centralized entities/exchange balance
+Annual performance down 64% following halving trend
+Active Addresses increased 2% QoQfull reports pic.twitter.com/6hhSqNEVbr
—Messari (@MessariCrypto) February 10, 2023
How did #Bitcoin fare in the last quarter of 2022 following unfavorable macro and cryptocurrency environments?
+FTX collapse caused a 25% swing, affecting centralized entities/exchange balance
+Yearly yield down 64% following halving trend
+Active addresses increased 2% QoQ
Read the full report here:
The report highlighted that changes in the fed funds rate had much less of an effect on the bitcoin price, even after increases of 75 and 50 basis points.
He also noted that active wallets increased 2% compared to the previous quarter; bitcoin moved from centralized exchanges to self-custody wallets during that period.
A research paper from the Federal Reserve Bank of New York earlier this week reached a similar conclusion.
The February 8 paper analyzed the links between macroeconomic news and the bitcoin price, and found that inflation was the only variable that had a significant impact on the bitcoin price.
“Unlike other asset classes, Bitcoin is orthogonal to monetary & macroeconomic news.” -NY Fed
Even the Fed sees bitcoin growing less sensitive to the macro backdrop as its liquidity expands.
The maturation from speculative risk asset to base layer monetary good is underway https://t.co/9ACRAg78Hi
— Joe Consorti ⚡ (@JoeConsorti) February 8, 2023
“Unlike other asset classes, bitcoin is orthogonal to monetary and macroeconomic news,” the Federal Reserve Bank of New York said. Even the Fed considers bitcoin to be less and less sensitive to the macroeconomic context as its liquidity increases. The maturation of a speculative risk asset to a base layer monetary asset is underway
The authors of the paper – research analysts Gianluca Benigo and Carlo Rosa – collected data from January 2017 to December 2022, analyzing the impact of macroeconomic news on various asset classes.
The study took into account many categories of macroeconomic news, such as inflation, the real economy, monetary policy news, and forward-looking indicators.
The authors were surprised by the results, and they concluded:
“The key result is that, unlike other US asset classes, bitcoin is orthogonal to monetary and macroeconomic news. This disconnect is puzzling, as unexpected changes in discount rates should, in principle, affect the bitcoin price even when bitcoin is interpreted as a purely speculative asset.”
Despite the US Federal Reserve continuing to hike rates at a record pace, bitcoin is off to a stellar start in 2023, rising just under a third, from $16,557 to $21,888.according to Yahoo Finance.
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