IM Academy Students Study Cryptocurrency as Market Activity Mirrors Tech Stocks

It has been a difficult few months for both cryptocurrencies such as bitcoin and tech stocks, including Netflix and Meta, but market participants are still trying to make sense of the correlation of declines in the cryptocurrency market and a variety of big-name tech stocks. Bitcoin has often been touted as “digital gold,” a means of hedging against market fluctuations caused by factors like inflation and international economic tensions. But in a recent article titled “Bitcoin Is Increasingly Acting Like Just Another Tech Stock,” The New York Times reported that bitcoin values are mirroring losses in the Nasdaq, a benchmark that’s weighted toward tech stocks. At IM Academy, a leading online financial education platform, students are studying the cryptocurrency market to understand how this new and dynamic market relates, if at all, to traditional stocks.

The questions for individuals studying the cryptocurrency market are whether cryptocurrency values will continue to mirror that of tech stocks, and when one or both markets will rebound. While these markets are inherently uncertain, IM Academy students are working to equip themselves with market knowledge to better grasp the factors that drive market trends.

Is Bitcoin a Tech Stock?

Bitcoin, or any other cryptocurrency, is unlike a traditional stock in several ways. When individuals exchange traditional stocks, they are exchanging shares of a public company. Companies can create additional shares, and the value of these shares varies according to the number of shares in existence, the company’s current performance, and speculation on its future performance.

There are nuanced differences that distinguish each cryptocurrency, but in general, when individuals exchange cryptocurrencies, they are exchanging tokens that can be used for decentralized transactions. In many cases, the goal is to facilitate direct user-to-user transactions that can be executed and verified using blockchain technology rather than requiring institutions such as banks or fiat currencies. In addition, there is a fixed limit on the number of bitcoins that can exist, one of the factors that has historically led to comparisons with other fixed assets such as gold.

The differences between the two types of assets raises the interesting question of why the markets for cryptocurrencies and stocks, particularly tech stocks, would mirror each other so closely.

Answering this question requires an understanding not just of what cryptocurrencies are, but also of how markets respond to internal market activity and psychological factors in addition to external factors such as interest rates, inflation, and international economic relations.

How IM Academy Students Learn About Cryptocurrency

Founded in 2013 by CFO Isis Terry and CEO Christopher Terry, IM Mastery Academy was established to empower individuals to pursue financial market education using easy-to-access online materials. IM Academy students who want to focus on the cryptocurrency market enroll in the DCX Academy, which offers lectures and readings, strategies, and live mentorship opportunities with IM Academy educators.

Students access the DCX Academy through the IM Academy web portal or mobile app. They can also participate in live discussions with educators through IM Academy’s GoLive forum, which provides opportunities to discuss ideas and strategies.

The content of the DCX academy is wide-ranging. It includes lectures on the technological basics of cryptocurrency such as the blockchain, digital currency wallets, and proof of work and proof of stake transaction validation, as well as market-based topics such as price gaps, candlestick patterns, time frames, volatility, and the impact of news.

As the cryptocurrency market continues to develop in its early years, trends such as the correlation between cryptocurrency values and tech stock values are a reminder of the importance of proactively understanding the market and the assets exchanged. For market enthusiasts such as students utilizing IM Academy’s DCX resources, pursuing a well-rounded education on the nature of the cryptocurrency market is crucial for properly contextualizing these and other trends as they occur.

Note: IM Academy is an educational forum for analyzing, learning, and discussing general and generic information related to markets and strategies. IM Academy does not provide personalized recommendations or views as to whether an investment approach is suited to the financial needs of a specific individual. Before deciding to participate in the forex or other markets, you should carefully consider your investment objectives, level of experience, and risk. Most importantly, do not invest money you cannot afford to lose. You should take independent financial advice from a professional in connection with, or independent of, research and verify any information you find on the IM Academy website.

Cryptocurrency-dominated investments may expose you to great risk. Cryptocurrencies are not FDIC-insured, are often not exchangeable for other commodities, are subject to price volatility, and have little to no regulation. Speculating in cryptocurrencies should only be performed by sophisticated investors who are prepared to lose their entire investment.