The global financial market is turbulent, Bitcoin has had a big dump of 20%, and its safe-haven attributes are being questioned.

March 9, 2020, is a day worth remembering in financial history.

Since the implementation of the circuit breaker mechanism after the "Black Monday" in the US stock market in 1987, the Dow Jones Industrial Average triggered the circuit breaker for the first time on October 27, 1997, with a drop of 7.18% that day, setting a record for the largest single-day drop since 1915.

On March 9, 2020, influenced by multiple factors such as the spread of the COVID-19 pandemic, the U.S. elections, and the plummeting of oil prices, the U.S. stock market crashed again, triggering the second circuit breaker in history, causing global stock markets to fluctuate.

At the same time, the cryptocurrency market has also suffered a heavy blow. Bitcoin, known as "digital gold," has fallen from $9,170 to $7,680, consecutively breaking through the two key support levels of $8,000 and $7,800, with a decline of nearly 20% over two days. The liquidation amount of contract trading on several major exchanges is close to $700 million.

Investment institutions generally believe that the sharp decline in U.S. stocks is the result of multiple overlapping factors. Prior to this, global financial market liquidity had already been insufficient, and market performance fell short of expectations. In fact, market funds are not as abundant as imagined, and there is a significant amount of leverage, which makes it prone to liquidity issues.

The synchronized decline of global financial markets has triggered a demand for safe havens, with panic prompting investors to sell stocks and withdraw from the commodities futures market, while funds are shifting towards safe assets such as gold, cash, and government bonds.

In the blockchain field, Bitcoin is regarded as having a value storage function due to its scarcity and was once considered a potential safe-haven asset. However, during this global financial asset crash, Bitcoin failed to rise like gold and instead experienced a sharp decline, raising questions about its safe-haven properties.

Some analysts believe that the view of Bitcoin as a safe-haven asset is overly optimistic. The market size of Bitcoin is relatively small, making it difficult to absorb the hedging demand from traditional financial markets' massive funds. In addition, Bitcoin's price is highly volatile, increasing by 300% in the first half of 2019, but dropping nearly 50% in the second half. This instability makes it challenging for professional investment teams to use it as a hedging tool.

From a hedging perspective, Bitcoin is currently difficult to compare with gold. Due to insufficient market depth and the lack of mainstream recognition and consensus, Bitcoin resembles a highly volatile risk asset, whose performance is highly correlated with market liquidity.

Nevertheless, this does not mean that Bitcoin can never become a safe-haven asset. Compared to traditional financial markets, Bitcoin is still a niche asset, and it is too early to position it as a safe-haven asset now. However, on the road to "digital gold", Bitcoin is undoubtedly the furthest and most promising one.

The financial market is ever-changing, and investors need to remain rational and make prudent decisions.