Digital assets will be largely decoupled from traditional equity markets by 2023, Arca’s chief investment officer Jeff Dorman believes.
Discussing his outlook for 2023 in a recent interview with Cointelegraph, Dorman argued that as the global economy enters a recession this year, stocks will be negatively affected while some cryptocurrencies will perform well. The value of the latter, he explained, is determined not only by macroeconomic factors but also by their usefulness within their respective ecosystems, which would remain unchanged in a recession.
“You’re going to see a lot of stocks hit under the weight of the restructurings and under the weight of lower revenues and lower cash flows,” Dorman said. “And you’ll actually see a lot of tokens do very well.”
However, the process of decoupling cryptocurrencies from equities may not involve Bitcoin (BTC), which Dorman believes will continue to be highly correlated with stock markets given its high sensitivity to macro factors such as global liquidity and interest rates. .
“Bitcoin just became a 24/7 VIX. Now it’s just a trading vehicle for large funds who want to get in and out of risk on weekends and during nightly trading hours,” Dorman said.
For more information on Dorman’s crypto predictions for 2023, watch the full interview on Cointelegraph Youtube channeland don’t forget to subscribe!
