Bitcoin has been the leading cryptocurrency since the industry was originally created. While many tokens have popped up since then, the relationship between Bitcoin and these altcoins has not always been tied directly into each other. As the second quarter of the year has just closed, Binance published a report to show exactly how the cryptocurrencies of the world are intertwined.
- Binance has released a quarterly report on the correlation rate between Bitcoin and other cryptocurrencies.
- The report shows a decrease in correlation, dropping from 0.73 to 0.61.
Over the course of Q2 2019, Bitcoin is finding itself in a unique predicament, as a new study from Binance indicates that it is now less correlated with other cryptocurrencies.
Binance’s Research report was released on July 5th, crediting this decorrelation to a possible “flight-to-quality” from the bull run that the market has been experiencing lately. The data in this report shows that the average correlation dropped to 0.61 from 0.73 in the first quarter.
The correlation rate is a way of measuring a statistic where there is some level of relationship between two or more assets. The value ranges from -1.0 to 1.0, and anything over 0.5 is believed to be a positive correlation. In contrast, a correlation below -0.5 is negative.
The report states that, while the correlation is still fairly high in this first quarter among other cryptocurrencies, Bitcoin appears to be breaking away from the others. In the last three months, there is a stronger correction between other cryptocurrency assets, though the largest growth in correlation has been seen between Tezos (XTX), Ontology (ONT), and Tron (TRX). Bitcoin SV, on the other hand, has seen the greatest decline in correlation.
There is speculation in the report that this decline has plenty to do with the fact that multiple exchanges have delisted the token, which was brought on by the conflicts between Craig Wright and his naysayers.
Dogecoin experienced a substantial decorrelation this quarter as well, though it was just listed to Binance today. Still, the token is seeing a consistent correlation with Litecoin (LTC) at 0.55. Binance states that the positive price correlation could likely be attributed to the merge mining that the two coins have taken.
During the research, Binance turns the attention to a “Binance effect” that they have noticed, in that the tokens listed on the platform have seen a higher average correction than the coins that remain not listed. After being listed with Binance, the DOGE token saw the biggest growth of major cryptocurrencies, rising by over 30% in value earlier today.
In Binance’s report of the first quarter, Binance discovered that the correlation dropped for Bitcoin, but increased among the major assets against the United States dollar. To view the entire Q2 2019 report from Binance Research, visit https://info.binance.com/en/research/marketresearch/correlations-q2-2019.html.
At the time of writing, Bitcoin is presently worth $11,112.86, experiencing a drop of 5.42% in the last 24 hours.