Bitcoin is sometimes described as a safe-haven asset, a form of digital gold; at other times it is seen as a risk-on asset. Which is it?

The latter, according to data from Elm Funds' Victor Haghani. In the early days of bitcoin, from 2014 to late 2017, there were "extended periods" when it behaved like a safe-haven asset, rising when stocks were falling – hence, the digital gold view which sees bitcoin as a protection against a financial system meltdown. Since early 2018, however, bitcoin has been a risk-on, risk-off asset; rising when stocks are rising, falling when stocks are falling.

If you woke up in a year’s time and saw bitcoin had quadrupled to $200,000, it would suggest stocks have also gained, says Haghani. If it collapsed to $2,000, you could assume stocks would be lower.

This may change – the ditigal currency has gone through “many rebirths and transformations” already, admits Haghani but three years’ of data shows it is “behaving more and more” like a “big, techie, super-volatile stock”.