December 15, 2020, 7:00AM EST
• 13 min read

2020 Macro Overview: Traditional & Digital Asset Market Behavior, Part II

Quick Take

  • The following is an excerpt from the ‘2020 Macro Overview’ section of the Block Research’s forthcoming year-end report.
  • We first break down the historic decline that traditional and digital asset markets experienced in Q1 2020. 
  • Looking at the Treasury-EuroDollar rate (TED) spread, we show that credit risk in the economy reached its highest level since the depths of the global financial crisis (GFC) in 2008. 
  • We then use studies and testimonies by US monetary authorities to understand both the cause of March’s credit market freeze, as well as the policy response by the Federal Reserve that helped restore confidence in the financial system.
  • Lastly, we plot the relationship between digital assets and traditional market metrics to challenge Bitcoin’s “safe-haven” narrative at this moment in time.

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