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On January 31st, according to CoinDesk, the price correlation between Bitcoin and luxury watches appears to have dissipated since the second half of 2023, following optimism in the crypto market towards Bitcoin spot ETFs.
Previously, the prices of both surged in tandem during the COVID-19 pandemic as central banks and governments injected large amounts of loose, low-cost funds into the economy.
Based on data from WatchCharts, the peak in luxury watch prices occurred at the end of the bull market in 2021 and the onset of the cryptocurrency downturn in 2022. Many traders cashed out at market highs during that time and shifted to other assets.
For most of 2023, luxury watch prices fluctuated in sync with the prices of the major digital asset index CoinDesk 20.
However, there was a divergence between the two in the third and fourth quarters of 2023 as the hype surrounding Bitcoin ETFs began to sweep through the cryptocurrency market, driving up the CoinDesk 20.
Earlier this month, the U.S. SEC approved 11 Bitcoin spot ETFs.
Greta Yuan, Head of Research at VDX, a regulated exchange in Hong Kong, stated that Bitcoin received attention from institutional investors due to the ETFs, while luxury watches lacked such attention, resulting in asynchronous price movements between the two.
Analysts at Morgan Stanley wrote in a January report that part of the decline in luxury watch prices was due to tighter monetary policies and a reduction in speculative trading of luxury assets.
Meanwhile, the continued tightening of global monetary policies continues to put pressure on luxury watch prices.
Charles Tian, founder of WatchCharts, noted that despite relatively stable prices in the fourth quarter of 2023 and December (possibly influenced by holiday shopping trends), overall market health indicators such as inventory age and total supply remain at historical highs. |
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Post time 16-2-2024 15:00:03