Aliens TLDR

Late last week, things were reversed, with gains for crypto assets as stocks fell.

The longer-term pattern, though, is for crypto to trade like tech stocks and other risk assets, rising or falling in response to hints on future monetary policy from Federal Reserve Chair Jerome Powell, recession fears, and even earnings disappointments.

For example, when Snap plunged in extended trading on Monday after CEO Evan Spiegel warned that the company would miss its revenue and earnings targets, Bitcoin almost immediately followed suit, breaking below $30,000 to hit its lowest price since the second week of May. But on Thursday, even as inflation expectations moderate and stocks regained some momentum, digital token prices were highlighting warts unique to the asset class.

“Bitcoin seems like it could still be vulnerable to one last major move lower and that is why many traders are waiting before putting on long-term bets.” So what’s the problem?

In her prepared remarks , she said the Terra meltdown, as well as the temporary de-peg of another stablecoin called Tether from $1, were reasons to introduce “clear regulatory guardrails to provide consumer and investor protection, protect financial stability, and ensure a level playing field for competition and innovation across the financial system.” It remains to be seen how long digital assets will keep the government’s gaze.

But crypto’s weakness on Thursday shows that the currencies could do worse than trading in line with tech stocks.