Over the past period of time, as the cryptocurrency market has gradually integrated into the global economic system, the linkage between Bitcoin and traditional financial markets has continued to strengthen. From geopolitical events to the Federal Reserve’s monetary policy decisions and the US election, the volatility of cryptocurrencies is increasingly affected by these major global economic events.

Do you feel it? Over the past period of time, Bitcoin has increasingly shown its linkage with global economic turmoil and traditional financial markets. For example, yesterday's price fluctuations were affected by the geopolitical conflict in Israel and the US port strike.

In addition, the Federal Reserve's (Fed) monetary policy decisions, the US unemployment rate, the risk of economic recession... all have a direct impact on Bitcoin. As can be seen from the figure below, the correlation between the SP500 index and Bitcoin has also reached a historical high recently. Coupled with the upcoming US election, the relevant policies of the two parties in order to win over cryptocurrency voters have also attracted much attention.

Bitcoin vs. US Stocks

Cryptocurrency and traditional finance are more inseparable

From my observation, you may find that we have recently published more reports on the overall economy, because we also believe that as cryptocurrencies are gradually accepted and embraced by more people, the boundaries between cryptocurrencies and traditional financial markets are gradually blurring.

In such an environment, cryptocurrency investors not only need to have basic knowledge of blockchain technology, but are also advised to learn how to interpret the international economic situation and the dynamics of traditional financial markets.

For example, understanding the direction of the Federal Reserve's policies and grasping the changes in global economic indicators have become important references for investors to make reasonable decisions.

How to quickly become familiar with the global economy?

So, how can you improve your financial knowledge in this fast-changing market? We asked ChatGPT and sorted out the following ways to improve financial knowledge:

1. Keep up with the news and international current affairs. Understand global economic events, such as the Federal Reserve’s monetary policy, economic data from various countries, and geopolitical events.

2. Learn basic financial knowledge. You can learn basic economics and financial theories, such as monetary policy, interest rates, inflation, and other concepts, by reading introductory books, taking online courses, or watching teaching videos.

3. Track market indices and asset performance. Regularly observe the trends of important market indices such as SP500, Nasdaq, and cryptocurrencies such as Bitcoin and Ethereum, and try to understand the relationship between these changes and international economic events.

4. Use financial tools and platforms. Using data analysis platforms, you can quickly obtain professional market information and interpretations, keeping yourself at the forefront of information.

5. Join investment discussion groups. Participating in discussions can deepen your understanding of market trends, learn how others analyze market risks and opportunities, and gain inspiration from actual cases. (But please make sure you are not joining a scam group)

Is Bitcoin still digital gold?

Some people may also wonder, is Bitcoin still digital gold? After all, its recent trend is closer to that of the U.S. stock market but the opposite of that of gold.

While BlackRock’s recent report noted that Bitcoin remains closer to a safe-haven asset in the long run, it may take a while longer for it to achieve the same effect as gold.

The short-term risk-averse narrative of BTC seems to have failed, which may be due to the following reasons:

1) Panic spreads in the market

2) Old OG whales are under pressure to ship goods

3) Bitcoin is easy to trade, so it is easier for investors to sell quickly

4) Bull squeeze