The Bitcoin market is currently experiencing a significant rally, driven by institutional investors and the institutional ETF (ETF) sector. This week, Michael Kantrowitz, Piper Sandler’s chief investment strategist, provided a bullish warning to investors. He indicated that the stocks in the most dangerous market position—a period after Bitcoin surged 54% since early April—could soon face an obstacle to its upward trajectory.
Piper Sandler’s note described Bitcoin as a “high-beta, low-quality” stock, which has seen “huge multiple expansions without any improvement in earnings expectations.” This behavior highlights Bitcoin’s vulnerability to adverse price movements. Initiatives are adding to the “tight directional correlation [with] equity market risk,” increasing the perceived downside potential for Bitcoin when macroeconomic risks surface.
S긩 Bitcoin’sinx is fear of a sell-off: Michael Kantrowitz warns Bitcoin risks climb while valuations stretch. As Bitcoin continues to rise, valuations are expected to be more expensive, with U.S. equities holding a virtually infinite market cap gap since the market crash of 2008. Michael pointed out that even with lower-than-normal volatility this year, Bitcoin tends to lose value when stock market panic rages. For example, in March, when President Donald Trump imposed tariffs, both Bitcoin and the S&P 500lost significant ground.
Thursdays are volatile, but not necessarily bearish: Michael’s cautious warning confronts the market. Despite the risks, Michael noted that a surprise regulatory decision could derail risk-averse investors. He estimated “modestly higher consumer price index (CPI) readings” in the next three months, which could pressure investors. While prices may rise, these trends are unlikely to sustain for extended periods.
The Kelly criterion for risk management: Michael Kantrowitz warns Bitcoin will squeeze during inflation. As economic uncertainties increase and “Goldilocks”之称的经济环境出现，投资者对通胀将加速上升和利率谈判失去耐心 may start using Bitcoin as a storage option. Michael suggested the firm believes higher inflation “is unlikely to_multiplicatively suppress interest rates,” but long-term prices could decline.
Short-hair, long-bin: Bitcoin pushes down more when fear clusters. The July August operationalslowdown, driven by summer trading down and thin trading, leaves Bitcoin’s weekly volatility weaker. However, such trends are unlikely to prevent sharp risks, particularly when the market pans out. Michael confirmed that this isn’t a full bearish stance on U.S. equities but rather a cautious call to focus on risk management.
investments in Bitcoin should be a strategy rather than a guide. Now is the time to start locking in gains, avoid speculative names, and cut losses, Michael advised. While crypto is a stable asset, excess risk in the markets remains a dangerous position, with Bitcoin likely to take a dirge in times of extreme panic.
