Markets
“The dollar is the most widely traded cryptocurrency,” says senior commodities analyst
According to an elder merchandise analyst, Bitcoin (BTC) volatility makes it late gold and the US dollar in certain investment perspectives. Meanwhile, BTC could crash harder than sotck exchange during recession.
Mike McGlone, senior commodities analyst at Bloomberg, spoke about market volatility in a context sign at Bitcoinday Miami this week. On this occasion, McGlone highlighted how Tether’s dollar stable coin (USDT) trades twice as much as Bitcoin on a typical day.
“Right now, I can access the US dollar anywhere in the world from my phone. [with] Attached. Tether is the number one trading token. It is the number one cryptocurrency in terms of trading. It doubles the value of a typical day compared to Bitcoin. It’s the dollar. The whole world turned to the dollar. For what? Because it is the least worst of all fiat currencies.
Mike McGlone
The senior analyst is particularly excited about Bitcoin as a hedging commodity to which companies will be exposed. However, he is also skeptical about the direction cryptocurrencyOther properties of , including its competitive advantages over other commodities and currencies.
Bitcoin would crash harder than stocks in a recession
Mike McGlone played an antagonistic role on the topical panel, raising concerns about Bitcoin as an investment asset. He mentioned that stablecoin issuers support their peg to the US dollar with Treasuries, suggesting a preference for low volatility.
Furthermore, the commodities expert pointed out that gold is the preferred option for central banks trying to hedge their treasury bonds. To illustrate these claims, Mike McGlone explained that actions are on the verge of collapse amid an expected recession compared to major finance indicators, but Bitcoin will suffer more.
“So please be concerned about the beta [of volatility]. (…) $55,000 billion is the total capitalization of the American stock market. That’s twice the GDP. This is the highest level since 1937. This shows how expensive everything is these days. Bitcoin normally trades with three times the volatility of the stock market. So when – I didn’t say if – the stock market experiences a normal correction relative to GDP, Bitcoin is more likely to go down initially. Gold is more likely to rise.
Mike McGlone
Tether to Bitcoin USDT trading volume
Interestingly, Finbold recovered data from Santiment, regarding Mike McGlone’s claims that the dollar is the most traded cryptocurrency and its relationship to Bitcoin trading volume.
At the time of writing, USDT’s trading volume stood at $41.76 billion, while Bitcoin’s trading volume stood at $14.59 billion. This gives a ratio of 2.86:1 between Tether’s US dollar trading volume and BTC.
BTC trading volume versus USDT. Source: Santiment/Finbold (Vini Barbosa)
In conclusion, although he is excited about Bitcoin’s long-term predictions, Mike McGlone remains skeptical about its abilities as a solid investment asset class or recession hedge. According to him, volatility plays an important role. Additionally, the US dollar and gold are superior assets for different reasons.