• Bitcoin is not rallying alongside meme stocks like GameStop and AMC Entertainment, despite their recent surge.
• Experts attribute this divergence to bitcoin being driven more by macroeconomic factors and its evolving perception as a store of value, rather than speculative trading.
• While the meme stock frenzy could potentially indicate an upcoming bitcoin rally, analysts suggest the lack of catalysts and macroeconomic headwinds may keep bitcoin rangebound for some time.
Meme stocks like GameStop and AMC Entertainment have seen huge rallies over the past few days, while Bitcoin has remained relatively flat. This is in contrast to 2021, when Bitcoin rose in tandem with meme stocks amid pandemic lockdowns and stimulus. However, the current macroeconomic conditions make a Bitcoin rally unlikely for now.
GameStop and AMC See Renewed Interest
GameStop and AMC Entertainment have each risen more than 160% over the past two days. Meanwhile, Bitcoin is little changed, down just 0.1% in the same period according to Coin Metrics. In 2021, GameStop and AMC rallied 821% and 373% respectively from January through April. Bitcoin’s gains in that time, though more modest, still came to 96%.
Bitcoin Faces Headwinds
According to Antoni Trenchev, cofounder of crypto exchange Nexo, “This isn’t 2021 when the world was locked down and awash with liquidity.” He notes that if GameStop is acting as a leading indicator, it could suggest a rally for Bitcoin is coming. However, today’s stronger than expected US producer price data is a reminder that inflationary conditions make a Bitcoin rally unlikely for now.
While there are many cryptocurrencies beyond Bitcoin, including meme coins, they haven’t joined the rally either. Dogecoin and Shiba Inu are each up about 3% in the past two days. Bitcoin is widely seen as driven by macro factors absent other catalysts like the launch of Bitcoin ETFs or the halving.
Bitcoin Maturing as an Asset
Noelle Acheson, author of the Crypto is Macro Now newsletter, says the meme stock run seems more like “revving engines” than a full takeoff. She notes macro issues continue to pressure Bitcoin. However, Bitcoin is seen as more of a store of value now versus pure speculation. Its holder base is broader, and it has become somewhat institutionalized.
Sylvia Jablonski, CEO of Defiance ETFs, says the market is starting to take Bitcoin more seriously, especially as it becomes accessible via ETFs. She notes both retail and institutional investors now tend to hold Bitcoin long-term rather than day trade it like meme stocks.
Timeline for Next Bitcoin Rally Unclear
After approaching $73,000 earlier this year, Bitcoin has been consolidating. With few catalysts and challenged by the economy, this lull could last for months and prices may fall further. According to Antoni Trenchev, “These periods of consolidation can last a long time and are intensely dull.” He doesn’t expect the meme stock revival alone to catalyze Bitcoin’s next move.
Conclusion
In summary, while meme stocks are rallying, Bitcoin remains rangebound due to economic headwinds. The macroeconomic backdrop makes a Bitcoin rally in the near future unlikely. However, Bitcoin is maturing as an asset class, which could fuel a rally down the road.
