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Sunday, June 26, 2022

Bitcoin Drops, Showing Little Sign of Hedge Against Volatility

Bitcoin plunged 8% Friday, the same day that the S&P 500 index slid 2.3%, suggesting the digital currency may not be the hedge against financial market volatility that its backers claim.

The hedge today was bonds, similar to much of market history. The 10-year Treasury yield slid 17 basis points to 1.48%.

Bitcoin recently traded at $54,263 and dipped as low as $53,625 earlier Friday. It has soared from its 2009 inception, but with substantial volatility along the way.

For example, it plunged 53% between April 12 and July 19 this year. The world’s biggest cryptocurrency has jumped 85% year to date.

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