In a lengthy social media post, Danish economist and financial analyst Henrik Zeberg predicted that the price of Bitcoin (BTC) could crash if the tech-heavy Nasdaq 100 index sees a major correction.
Zeberg insists that there is nothing inherently special about Bitcoin, arguing that it is a typical risk-prone asset.
The analyst is convinced that the U.S. stock market is currently in a major bubble. Zeberg has noted that the current market capitalization-to-GDP ratio is even higher than on the verge of the global financial crisis in 2007.
Why there is correlation
As reported by U.Today, Bitcoin and Nasdaq tend to have a high correlation because they are seen as risk-on assets that tend to outperform when there is risk-on sentiment.
They often tend to be driven by speculative traders who are chasing big price swings.
Both cryptocurrencies and tech stocks tend to be highly sensitive to liquidity conditions.
Zeberg says that Bitcoin and tech stocks moving in tandem “makes sense” because they are tech-related.
“Tech bubble” 2
Zeberg is convinced that there is currently yet another tech bubble in the making.
Moreover, he is convinced that Bitcoin will be part of that crash, warning traders against being caught in the “bubble euphoria.”
On Aug. 8, the Nasdaq index reached another intraday record high of 21,464. Bitcoin is also within striking distance of a new peak, currently trading at $118,336.