While crypto has been on the grips of a particularly stubborn bear market, the traditional financial markets aren’t looking to bullish either, a former equities manager turned crypto aficionado believes he has the reason for this and that it will lead to cryptocurrencies outperforming every other asset class in the coming year…
Travis Kling a former L/S Equities Portfolio Manager who “fell down the Crypto rabbit hole.” Posited his thoughts via Twitter:
Crypto has never existed during a bear market in traditional assets.
BTC was birthed at the very beginning of the largest monetary experiment ever- globally coordinated QE. Ending QE is causing pain
There is a significant chance Crypto is the best performing asset class in 2019 pic.twitter.com/vIdKTrm5sV
— Travis Kling (@Travis_Kling) December 23, 2018
Kling asserts that crypto can outdo other markets due to the era of quantitative easing (QE) ending. QE is a system in which a central bank prints new money and adds it to the current supply in order to lower interest rates; in turn, this provides financial institutions with further capital to increase liquidity and encourage lending.
So what does this have to do with crypto? Well, Kling states that due to QE coming to an end this year, almost 90% of traditional asset classes have shown a negative return.
However, Bitcoin and other decentralized altcoins are immune from this correlation to QE reaming unaffected by its revealed. This inverse correlation will only bolster crypto going forward as investors start to lose interest in falling stocks, and turn to a more lucrative asset.
Read more: Think crypto is a bubble? Check out some of NASDAQ’s biggest losses…
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