• Bitcoin price spiked above $69k as US inflation data showed the highest increase in 30 years
• The stock markets reacted to unexpected data

and caused a sharp drop in the following day.

• Analysts believe this means that Bitcoin is still risky
• Mainstream could however see the crypto as a safe haven investment

Bitcoin’s surge to prices above $69,000 amid rising inflation concerns provided further proof that investors are increasingly viewing the cryptocurrency as a better inflation hedge.

Spiking alongside gold, Bitcoin reached highs of $69,044 on 10 November. It remains bullish as of writing, with new momentum pushing it above the $66k level once again. This scenario sees BTC perceived as a more valuable store of value day by day.

Many market and financial experts believe that Bitcoin is a safer option than traditional safe-havens.

Adam Button is an analyst at ForexLive and says that despite recent rallies on inflation fears, Bitcoin still remains a risky asset. He says the rally provided a clue as to the flagship crypto’s growing status as a hedge asset. Its sudden price fall on the day it reached its current ATH seems to suggest otherwise.

“The crypto rally on high inflation is a hint on where it’s headed as an asset class, but the sharp, late-day drop underscores the limitations. For now, bitcoin is still a risk-on asset,” he explained.

John Kicklighter, another analyst, points out that Bitcoin’s selloff coincides with losses in stock markets, reducing the cryptocurrency’s claims to be a risk-off asset.

Bitcoin’s high stock market correlation and high volatility make it more appealing to investors looking for higher returns and not just those who want to hold onto assets in a market dependent on greater stimulus spending.

According to Kicklighter the retail market prefers Bitcoin to the dollar during times of higher inflation. Institutional interests are unlikely to switch into BTC when there is liquidity.

Button states that, despite its limitations, Bitcoin’s increasing attraction to institutions is making it more popular.

“I don’t think there’s any doubt that it already is [mainstream]. It’s crossed the threshold now and will continue to gain acceptance,” the analyst added.