According to recent data from IntoTheBlock, Bitcoin (BTC) no longer moves in lockstep with the S&P 500. The correlation has reached zero, something that has not happened since November 2024 – just before the cryptocurrency surged past $100,000 per BTC.
It is unknown how long such a divergence can last and if the positive effect we saw in November will be repeated this time.
One good thing is that with all the important macro data coming out recently, perhaps the cryptocurrency market will find easier conditions, as, for example, the recent hotter than expected CPI data significantly affected Bitcoin and other cryptocurrencies and the drawdown was palpable across the sector.
Bitcoin’s correlation with the S&P 500 has dropped to zero, indicating no current linkage between the two.
The last time we saw such a low correlation was on November 5th, 2024, just before Bitcoin soared past the 100k mark. pic.twitter.com/18lgW1zOql
— IntoTheBlock (@intotheblock) February 17, 2025
However, this does not mean that crypto will not be affected by traditional financial market data at all now, and it will most likely have its own behavior pattern for such news.
Moreover, Bitcoin has been seen as a beta for tech stocks, and with the risk of stagflation, this correlation could pose a big risk for the leading cryptocurrency. On the other hand, the cryptocurrency is seen as the digital gold, and this is what may give it a positive outlook in the coming hard economic times.
Bullish for BTC, not for crypto?
Despite Bitcoin’s decoupling from the S&P500, its link to gold remains steady and may come in handy. However, altcoins trade more like stocks, and their bright future is not guaranteed even if the cryptocurrency maintains its strength.
As things stand, the market may anticipate Bitcoin’s strength in the near future, and BTC’s dominance, while gold renews its all-time high. But another death spiral for altcoin is highly likely if the worst economic scenarios become a reality.
