All these burnt investors will turn to T bills or gold. When the stock market collapses, risk aversion takes hold. People tend to sell risky assets and cryptocurrencies are definitely considered risky assets. So dont be surprised if an equity crash is followed by a crypto crash.
Yes, when the stock market crashes, they would find a way to secure their assets and most likely they would go back to the one they are most comfortable with which is gold. Although there is a possibility that they would shift their investments and put it in cryptocurrency instead, they may think that it might be the same as stocks as it is still a speculative market so instead of cryptocurrency having the advantage, it would still be affected with the crash.
Exactly, crypto is the king of speculative assets, zero inherent value. When the stock market tanks, crypto will tank right along with it, and more likely harder. The reason is the evaporation of economic confidence. When things begin to fall, people aren't going to have the confidence that this inherently worthless digital token is going to be valued higher by someone else in the future than what you bought it for. Stocks have inherent value; each share is worth the liquidation value of the company, which makes them vastly safer than crypto. Stock market crashes are about a flight to safety and reducing risk, so if money is fleeing far safer assets than crypto, logically I would expect money to flee the riskier assets quicker. That means away from crypto.
Many are expecting about the impending crash of the stock market this year due to the cycle which is ten years from 2008. Even banks are having a hard time retaining their employees and if that happens then most likely, cryptocurrency market would crash as well and people would just buy gold because they know that it always has value and more uses unlike cryptocurrency in which majority of it are just existing for trading purposes.