Down 14% in the last month. Still way above its actual value (0) but headed in that direction.
I'm guessing cost of living is driving a lot of hodlers to liquidate. You have to imagine most of the money in this thing is institutional though so maybe it won't matter that much.
Inflation is driving the cost of commodities up but BTC seems to move in the opposite direction. This is meaningful bc the value prop of BTC as an inflation hedge would suggest the opposite, and BTC overweight portfolios will underperform the diversified commodities basket. If this persists it's only matter of time before we also see some institutional unwinding
I don't follow that market super closely but it's interesting nonetheless. It seems these big corrections happen from time to time as well so could just be more of the same. Still one wonders if we are starting to see some structural covariance.
That isn't a unique feature of crypto though.
Money that derives its value from the material it is made out of is called commodity money.
Money which has no intrinsic value but which everyone agrees can be exchanged for a valuable commodity is called representative money.
Money that derives its value from government regulation and protection is fiat money.
All of these are money and they've all been used by people successfully to supplement barter systems for thousands of years. Moneys don't have to have intrinsic value to be valuable, their value emerges socially.
Has anyone audited Fort Knox recently? Can we see the gold that supposedly guarantees the USD's value? Is there enough to cover all the USD in circulation?
It doesn't matter. Even if the gold standard were still in effect it wouldn't matter (until france demands to be paid in gold) because in practice fiat currency is valuable because we all agree on its value and we believe that tomorrow it will be similarly valued and we will be able to exchange it for intrinsically valuable things. Shared belief in the value of money is sufficient for it to work. Intrinsic value is basically irrelevant.
edit: tbh until relatively recently even the value of gold was mostly socially constructed. Gold's value used be based almost entirely on its rarity, not its utility in industry.