$BTC #BTC
Investor confidence plummeted during the initial moments of panic, and even gold fell to its lowest level in seven months. However, the long-term impact favored risk assets. The S&P 500 recovered its losses by the end of May 2020, while Bitcoin regained the USD 8,800 level by the end of April 2020. Essentially, the panic subsided in less than three months.
Despite its adoption by large companies as a treasury reserve, Bitcoin remains strongly correlated with tech stocks. Between March and May 2025, its 30-day correlation with the Nasdaq 100 remained above 70%. Investors continue to view Bitcoin as a high-beta bet on future economic growth.
The increase in tensions in the Middle East has once again emerged as a significant macroeconomic risk. The Strait of Hormuz manages approximately 20% of the world's oil and gas supply. Any disruption in this area raises energy costs and uncertainty. As companies scale back their operations under these conditions, inflation expectations cool, and hiring slows, creating room for monetary easing.
Trade remains another source of fragility. If the temporary tariff truce between the United States and China breaks down, or if key partners like Canada or the EU withdraw from negotiations, U.S. exports could be affected.
To counteract weakening demand and protect the domestic industry, the Federal Reserve of the United States may resort to interest rate cuts that support credit expansion and investment.
