Can Bitcoin's Price Measure Stock Market Volatility?

There is growing evidence that the stock market and the crypto market may be more aligned than many people think.

The stock market and crypto markets have been on a similar trajectory since crypto's nascent rise in early 2017.

Interestingly, the price of Bitcoin has consistently preceded the stock market by several weeks.

This trend has led some to question if the price of Bitcoin may be an indicator of the stock market's future value.

Dominic Chu of CNBC Business News described Bitcoin as a possible "Tea leaf" that stock market investors might use to determine investment strategy.

Many investors rely on the CBOE Volatility Index as a way to measure stock market volatility and potential future prices.

In addition to using Bitcoin as a volatility meter, Stutland sees Bitcoin as a way for investors to protect their assets during periods of unique volatility.

Some commentators question whether Bitcoin is truly a fair judge of volatility or if traditional secondary markets like the VIX are just slower to react to market realities.

This wouldn't be the first time that investors attempted to use Bitcoin to measure other markets.

In March, Tom Forest, the chief investment officer at Forest Capital Management characterized Bitcoin as a helpful sentiment indicator for different markets.