Analysis: Bitcoin Could Face More Downward Pressure If U.S. 'Big 7' Share Prices Continue to Fall

According to Cointelegraph, a sharp drop in the share prices of the “Big Seven” US stocks could put more downward pressure on the price of Bitcoin. The “Big Seven,” an alias for a number of top-performing tech stocks such as NVIDIA and Microsoft, saw their cumulative market capitalization evaporate by more than $650 billion during regular trading on August 5th. Despite a slight recovery since then, another decline in top tech stocks could lead to a drop in the price of bitcoin, according to Akshay Nassa, founder of the Chimp exchange, who said, “The correlation between stock market performance and cryptocurrency value is well documented; as major tech stocks fall, investor sentiment typically shifts to alternative assets, including Bitcoin.” Nassa further stated that the correlation between bitcoin and tech stocks has become even more important as the Nasdaq, which is heavily weighted in tech stocks, enters a period of significant correction, and that this effect could spill over into the cryptocurrency space.

Alvin Kan, COO of Bitget Wallet, said that while stocks are generally more resilient to market volatility, another decline in the “Big Seven” of US stocks could hurt the price of Bitcoin, explaining that the pressure on tech stocks, coupled with other crypto-specific catalysts, could threaten to push the price below 50 percent again. Other factors affecting the price of Bitcoin and cryptocurrencies include the Bank of Japan's latest interest rate cut, as well as “aggressive” ETH selling by market makers such as Jump Trading, Kan added.