Week of Apr 26, 2022

Bitcoin Has Been Outperforming Gold & Other Safe Haven Assets Since The Start of The War

The Fed’s Hawkish Expectations Could Be Affecting Crypto Markets. Mega Cap Companies Report This Week.

💬 Market Commentary


It’s been a turbulent week in financial markets, with big moves in what otherwise are deemed to be “boring” markets - like bonds and foreign exchange. 

Interestingly, we can use Bitcoin to see the magnitude of some of these macro trends at play. 

Let’s start with foreign exchange by taking a look at the price of bitcoin in U.S. dollars, Euros, and Japanese Yen, to see the recent relative strength of the greenback. 

As we can see, in Japanese Yen terms, Bitcoin is up +17.46% since the war in Ukraine started. In Euro terms, Bitcoin is up only +12.06% in the same time period. Lastly, in U.S. dollars, it is only up +6.09% for the same period. 

In other words, this means that the U.S. dollar has gained approximately 6% vs. the euro and 11% vs. the Yen in just 2 months. That’s a lot of purchasing power lost in 60 days.

Now, let’s see how Bitcoin has been doing when compared to Gold, the S&P 500 index, and the U.S. dollar index. 

As we can see, Bitcoin has been performing better than gold, the U.S. dollar index and the S&P 500 index since the war in Ukraine started. 

Bitcoin has been outperforming the best safe-haven assets during the largest geopolitical conflict since its inception. This is a big feat for an asset that is just 13 years old.

Markets seem to have found some relief yesterday after the Twitter transaction was announced. 

As we will cover in the following sections, Central Banks are waging an all-out war on inflation, trying to squash corporate investment and disposable income by increasing the cost of borrowing (debt and mortgage payments). This will inevitably have a short-term impact on asset prices. However, a lot of the technology sector has been deeply oversold, and the recovery rallies that we are seeing might be short lived. 

While bitcoin may continue to have a strong relative performance, the trend for  most asset prices is clear - and there will be continued pressure to the downside. 

When there is a broad risk-off sentiment in markets, correlations between asset classes tend to increase, and many financial assets start moving in tandem. We can see this play out as the 1-month correlation between the S&P 500 and Bitcoin is near all-time highs. 

The market may provide some wonderful buying opportunities for long-term investors in the weeks ahead.

S&P 500


The S&P 500 has declined year-to-date, yet the S&P 500 continues to trade circa 19x P/E ratio, above the ~16x long term average. The S&P 500 has fallen for three consecutive weeks, to a low level not seen since the middle of March. Markets have seen volatile times this year as investors have taken risk-off their portfolios as they continue to assess the risky macroeconomic environment and the expectation of rapid monetary tightening that investors fear could hinder economic growth. Tasked with the duty to fight inflation, the Fed has vowed to aggressively tackle this matter by increasing rates. 

The largest four U.S. S&P 500 companies - Amazon, Alphabet, Microsoft and Apple have a combined market value of $8 trillion and make up about 20% of the index weight. Year-to-date, all major companies have experienced drastic losses (as seen on image above). 

Tech stocks will need to adjust outlooks and expenses. Recently, the European Union regulations committee agreed on new policies that would fine tech companies up to 6% of their global revenues if they fail to crackdown on harmful or illegal content on their platforms. Companies with 45 million EU users or more will fall under the scope and can face billions in penalties. Investors will weigh in on recent COVID developments, the Fed’s hawkish tone and earnings outlooks as the market attempts to get a sense of market direction for the quarters to come. 


Gold has hit a nearly four week low during trading hours on Monday. Equities in China took a dive at the beginning of the week and with it, the potential demand for raw and precious materials. Mounting COVID cases and shutdowns across mainland China has equity markets rethinking allocations in more attractive safe haven assets. The resurgence of COVID in China could further disrupt the already crippled international supply chains. Additional selling pressures are mounting on precious metals as the U.S. dollar index pushes to a multi-year high. On Monday, the Chinese yuan dropped to its lowest price versus the U.S. dollar since 3Q20.


Payments processing giant Stripe has partnered with Polygon to allow users to pay USDC. Twitter, the newly Elon Musk acquired company will be Stripe’s first partner that will roll out the service. The partnership will allow Twitter users to capitalize on their followers, content and activity on the social platform. The partnership paves the way for other FinTech and financial service companies to integrate into Web3. Stripe hopes to support crypto payouts in over 120 countries by the end of 2022. Something to also keep in mind is the “Elon Musk effect” as Tesla purchased Bitcoin and holds it on its balance sheet. Additionally, Elon Musk is a big supporter of $DOGE, a currency that could one day be added as another form of crypto payments. 


Bitcoin’s hashrate reached a lifetime high over the weekend (271.2 EH/s). A network difficulty change is expected on April 27. The current computational power is hovering around 233.8 EH/s. After experiencing a decrease in the difficulty adjustment algorithm (DAA), which brought a 1.27% drop in the network difficulty, the DAA is expected to increase by ~3.25% as the hashrate continues to run at high speeds. If the estimated DAA is reached, Bitcoin’s network difficulty would increase from the current 28.23T to a new all-time-high above ~29.25T. Foundry USA captured 22.6% of the global hashrate over the last 72-84hrs (47.89 EH/s), followed by Binance Pool with 12.98% (27.56 EH/s). 

What's Ahead

It’s options expiration week this week for Bitcon with over $2 Billion worth of options expiring on Friday. With the max pain point for the April expiry sitting at a concentrated range of $34,000 to $38,000 as per coinglass analytics - there is a decent probability that market makers could look to drive Bitcoin into that range if prices are within 2-3% come Thursday. Something market participants should keep an eye on. 

As the market comes under pressure, we wanted to highlight some key support levels for bitcoin prices - namely the Microstrategy Support line - which is the average purchase price of Microstrategy’s BTC holdings. Currently sitting at $30,200. This is an important level as institutional investors will likely look to defend this price. Given how bitcoin has been holding up in the current geopolitical environment, it would not be surprising to see opportunistic institutional investors take advantage of the opportunity to add to their portfolios at “Saylor” prices.

U.S. mega capitalization companies - Amazon, Google, Apple and Microsoft will release corporate earnings this week. In addition to the mega caps, about 180 other S&P 500 companies will release earnings this week. Earnings will echo senior management’s corporate outlooks which will provide investors with forward looking projections of different sectors within the economy. These corporate earnings come on the back of rising yields, staggering inflation, COVID resurgence and global supply issues in addition to the Fed’s hawkish tone that has investors on edge. With the Fed’s monetary policy putting pressure on equities, investors will look for a solid earnings week and strong corporate outlooks to make the case to keep supporting markets at current levels.  Market data will be released this week, such as initial and continuing jobless claims, real gross domestic product (SAAR)(first estimate), the Chicago PMI, University of Michigan consumer sentiment index (final), University of Michigan 5-year inflation expectations (final) and PCE price index. This week will definitely be a busy week with lots of data releases and corporate earnings that will grant investors a broader picture to assess the global equity markets and decide directional investments going forward.

We hope you enjoyed reading and as always, we wrap up with a summary of the upcoming economic data and earnings reports for the week:


8:30 AM EST - Advanced report on international trade in goods

10:00 AM EST - Pending home sales index and rental  vacancy rate 


8:30 AM EST - Initial jobless claims, continuing jobless claims, real gross domestic product (SAAR) (first estimate), real final sales of domestic product (SAAR)(first estimate)


8.30 AM EST - Employment price index, PCE price index, core PCE price index, PCE price index (year-over-year), core PCE price index (year-over-year), nominal personal income, nominal consumer spending, real disposable incomes, and real consumer spending 

9:45 AM EST - Chicago PMI 

10:00 AM EST - University of Michigan consumer sentiment index (final), University of Michigan 5-year inflation expectations (final)

It's a big week coming up, and as always, we'll keep you posted on any relevant news throughout the week right here and from our Twitter account.


This article is intended for general information and discussion purposes only, it is not an offer, inducement or solicitation of any kind, and is not to be relied upon as constituting legal, financial, investment, tax or other professional advice. This article is not directed to, and the information contained herein is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution, publication, availability or use would be contrary to law or regulation or prohibited by any reason whatsoever or that would subject Ledn and/or its affiliates to any registration or licensing requirement. This article is expressly not for distribution or dissemination in, and no services are being marketed or offered to residents of, the European Union, the United Kingdom or the United States of America. A professional advisor should be consulted regarding your specific situation. Digital assets are highly volatile and risky, are not legal tender, and are not backed by the government. The information contained in this publication has been obtained from sources that we believe to be reliable, however we do not represent or warrant that such information is accurate or complete. Past performance and forecasts are not a reliable indicator of future performance. Any opinions or estimates expressed herein are subject to change without notice. We expressly disclaim all liability and all warranties of accuracy, completeness, merchantability or fitness for a particular purpose with respect to this article/communication. For full legal terms and conditions visit https://ledn.io/legal

About the author

Mauricio Di Bartolomeo

Mauricio is the co-founder and Chief Strategy Officer of Ledn.io. He grew up in Venezuela where he and his family learned about Bitcoin. Now based in Canada, Mauricio holds HBA and MBA degrees from the Richard Ivey School of Business in London, Ontario in Canada.