Bitcoin Forum

In the future I believe this will change, but for now the price is still very much tied to the stock market, which makes little sense to me.
Whenever the US stock market goes up (especially the NASDAQ), bitcoin goes up with it, and vice versa.

The tariffs are impacting imported goods into the US, they have nothing to do with bitcoin. There are no tariffs on bitcoin.
So why do many investors still treat bitcoin as if it were a tech stock? Bitcoin is a commodity like gold or oil, not a security or a stock.

Whatever happens to the stock market should have little to no impact on bitcoin, at least in theory.
The market is not rational and seems to have little understanding of what bitcoin is (it is a store of value).

Unlike publicly traded companies, bitcoin is not a good or service that relies on the volume of sales or on tariffs to determine its price.
In a more rational market bitcoin would not be so closely correlated to the stock market or treated as a speculative asset.

Whenever you are investing in a highly centralized company controlled by a group of people, there are always going to be trust issues.
So with stocks you are investing in a truly speculative asset. Because the humans controlling it are unpredictable, easily manipulated and corrupted.

But bitcoin is not subject to such trust issues, because it isn't controlled by anyone.
That is the revolution and beauty of bitcoin. The open-source code is a known quantity not subject to unpredictable human behavior and corruption.

Bitcoin price is not tied with the stock market perse
They both exist in same environment
And anything that affects the stock market
Should have a ripple effect on Bitcoin price.
Factors like political changes, geopolitical crisis, economic instability
Wouldn't just affect the stock market.
Not to mention investors sentiments towards the general market.


There are quite something's that prove it Bitcoin Halving
Cryptocurrency specific news, and regulations.
Failure of the financial system tend to improve the price of bitcoin later on
While having an indifferent or negative effect on the stock market.

Why is gold different?

I like how gold performed. It dropped when Trump was elected. Now not correlating to United States stocks.

Gold increased got to ATH when United States stocks were falling because of Trump tarrif war but gold keeps increasing.

Trump increased import tarrif on cars yesterday which could the reason.

But after a long period of time, bitcoin will still increase than decrease.

It is at times and isn't at others.  Also you don't specify which stock market in your title.  Sure, I know you're speaking of the US stock market as it how a sizable down day as is bitcoin , as we speak.  There are a lot of other asset classes that are also seemingly or somewhat tied to the US stock market and sometimes everything is.  You can't generalize this though as bitcoin and the US stock market do not always move hand in hand.

Agreed with your take on the tariffs.

These will keep on coming to make investors sceptical about the whole situation and not gain enough trust to push forward.

There are imo two or three effects in place:

1) Independent variables, which affect both Bitcoin and stocks in a similar manner. The most well known are Central Bank interest rates, being the Fed obviously the most influential but also the ECB rates sometimes have effects. The higher the interest rates, the weaker the demand for "risk assets" like tech stocks and Bitcoin.

And this is related to ....


Tariffs could have an effect on inflation, rising U.S. consumer prices. And rising consumer prices means that the risk of a interest rate increase is higher.

2) But you are probably partly correct with this assumption:


There is uncertainty about Bitcoin's value proposition. What makes Bitcoin valuable? This question isn't fully answered, and there are several competing theories with different conclusions (Total Market Size, Social Network, before 2022 also Stock-to-flow etc.). This makes investors which are unsure about these theories' validity "hang" themselves to the stock market prices.

3) There is also perhaps a third effect, and that is that there are some primarily US Bitcoin-related public companies (MSTR, Coinbase and mining, mainly) with already a quite high representation in the tech indexes. Bitcoin's wellbeing (and price) affects these stocks and thus also the stock market. This effect should be quite small at this moment but it could increase in the future if MSTR and similar companies' business models continue to expand.

Bitcoin Isn’t placed on tariffs to actually say the tariff crisis will affect it directly which is right but bitcoin is an investment or asset which is affected by the economic situation and Tariff happens to have its impact on the economy because a decrease and increase of the tariff actually affects the price of service.  For example if Tariff are increased which leads to increase in spending since there is no corresponding increase in income there is need for one to find alternatives to actually use to support this new increase there is always this option of people liquidating some of their holdings and the common thing most people do is they simply go for volatile assets like cryptocurrency to sell off to make ends meet and this is where even bitcoin gets hit during economic crisis. So long as bitcoin is an asset for people all economic related news will affect it badly

The market may not yet fully appreciate what bitcoin is, but to me the value proposition is perfectly clear.
Those who don't understand bitcoin very well may just treat it as any other risk asset to day trade or swing trade as if it were some kind of memestock.
The multitude of shitcoins on the market doesn't help either, and were probably created by Wall Street types to sow even more confusion.

But bitcoin is totally unique in that it is not exposed to the risk of human behavior. It is a protocol that cannot be changed.
In that sense bitcoin is not a risk asset, because the risk of centralized control is removed.

When you think of highly corrupt governments in the third world where annual inflation is something crazy like 100% and the money is completely worthless,
the value of bitcoin becomes crystal clear. And some of the advanced economies of the west seem to be headed down the path of hyperinflation
much more quickly than anyone could imagine.

It's time the get your hands on multiple sources to be able to buy into this dip and do everything possible to take advantage of the discounted price that is presented right here and now, because this current low price benchmark won't last long before we begin to see more momentum in the market, but for stocks market, this is the wrong time and even though the global trade market is a chain, it won't drag assets like gold or Bitcoin along too much and it will not correlate most times.

Unfortunately at "the market" advanced Bitcoin users (who know a bit about the value proposition) are a small minority. Even institutional investors often use outdated theories, and if they fail, they will stick to the stock prices as an indicator for Bitcoin's possible success. And in "the market", numbers matter - if the "dumb money" is the majority, they will dictate the price.

There's a certain logic in the assumption "if tech companies are successful, then also Bitcoin could be successful". Because both Bitcoin and tech companies for example may benefit from a higher Internet usage (this is another example for an independent variable). I don't agree with this logic, because Bitcoin is not a company and has a quite unique way it works (it's a DAO but you don't really own shares if you own Bitcoins), but many investors' minds seem to compare everything with companies, and thus will stick to this logic and treat Bitcoin like a tech stock.

And even those who know a bit about the value proposition are often clueless when one asks them about the "fair" price of Bitcoin. How high is it?

Is it the current value of "a bit below 100.000" as the hypothesis of efficient markets dictates? Is it much higher, e.g. if we say it has the potential to rival gold's "market cap"? Or is it lower, because we're in a bubble currently fueled mainly by MAGAs?

Yes, there is the 21 million limit, but the crucial question is the size of the total addressable market for this 21 million. And there may be completely legit altcoin competitors (XMR, for example) which may become stronger in the future, so the "scarcity" of Bitcoin depends also on the popularity of other market participants, not only on its protocol.
 
There's some logic in this line of thinking. And I agree that as the Bitcoin protocol, at least the basics, are "ossified", there is less space for human intervention as in the case of stocks where the company could always decide a capital increase, for example.

But I don't agree fully. "Bitcoin" is not only the protocol. It's more than that. It's an entire ecosystem of humans, businesses, merchants, users, hodlers, traders ... And the way this ecosystem behaves indeed is dependant on human behavior.

IMO Bitcoin isn't on its full potential (I think it could be more popular and also the price could be higher) for this reason, there are too many users engaged in short term "wave riding", which makes Bitcoin more volatile and less useful for all use cases which aren't risky speculation. You still need to be able to afford a bear market.

One advantage centralized tech companies (including altcoins) possess is mass marketing that can generate slick advertising spreading product awareness
to a wide audience. But as a protocol that is owned by no one, bitcoin doesn't possess the dedicated marketing departments you find with conventional centralized
companies.



The short-term, impatient mindset of most "investors" in the stock market doesn't help to understand the long-term value proposition of bitcoin.
The corporate mindset of quarterly profits is a barrier to understanding bitcoin as a long-term investment.
They are more accurately described as traders or gamblers than investors, which is especially true of those playing in the shitcoin casino.

I can't think of a single altcoin that even claims to be a store of value or long-term investment.
 

That is of course true. But you asked why Bitcoin's price is correlated with the stock market, and my answer is "because many market participants treat it like a stock" ;)

I guess your question was more a rhetoric one, more a criticism of investors who think that way. But it's sometimes advantageous to try to understand these major market participants, so we know that not every dip means that Bitcoin has become less valuable :)

Even if currently most altcoins are indeed not good to store value (I already mentioned one I consider a rare exception, but its popularity is far from Bitcoin's currently), that may become different in the future.

For example, take the following scenario: A new war about a protocol feature like Segwit emerges. The Bitcoin devs and miners select an option which isn't approved by most Bitcoin hodlers. This would make it possible that a fork becomes more popular than the "main" Bitcoin chain.

I believe the likelihood for some altcoin "flipping" Bitcoin is very low, but it is not zero, even if maxis claim that :)

Are you sure using a mass marketing effort will be effective to "correct" the mindset and make traders view Bitcoin differently compared to stocks? I honestly doubt that is the case. Most of them are moving based on profits. Even if you spend money on marketing to influence people not to treat Bitcoin as stock it doesn't matter if the majority of traders are ignoring that. I feel pouring money to force that change is a waste. I'd rather spend money to support people making educational content or development.

It's up and down in correlation with time but it seems with Bicoin Spot ETFs in USA and BlackRock as well as other institutional investors in this market, since January 2024, manipulations from institutional investors make Bitcoin market more tightly correlated with stock market.

Will it continue in future?
I think it will continue.

Will its correlation become stronger, more positive in future?
I think it will move forward this way.

However Bitcoin market is volatile and I believe there will be months in future, Bitcoin market will move oppositely to stock market and gold market.

Understanding Bitcoin Correlation to Stock Market & Its Impact. (https://www.bitcoinmagazinepro.com/blog/understanding-bitcoin-correlation-to-stock-market-its-impact/)
https://newhedge.io/bitcoin/us-equities-correlation
https://www.theblock.co/data/crypto-markets/prices/btc-pearson-correlation-30d

if i'm speaking frankly, majority of stock investor have no idea, I think the same thing happened to bitcoin because there are many stock investor who tried to invest in bitcoin as well and at macro level, they consider bitcoin just like stock, a risky asset.
so the price action might follow stock.

i'm even sure that majority of bitcoin ETF buyers were passive stock investors trying to diversify their portfolio.

tariffs, although just affecting imported goods, still can spread fear to various niche of investments, including crypto, most of people are buying and selling based on their emotion, things like this could cause worry, it's to be expected.

Back in 2019 when the COVID pandemic broke out and basically destroyed global economy all markets dumped. Then some people started creating a fake correlation between bitcoin and US stock market because they were both dumping due to the same reasons (global economy crisis).

That correlation was never real but because enough people believed the fake news, in the following years some newbie weak hands started acting irrationally whenever US stock market made a move therefore solidifying that fake correlation!

In the past year or two things have been similar, we are facing another global economic crisis which is affecting all markets. Which is the reason for bitcoin not rising as fast as it should. When it is not rallying, the weak hands I mentioned in second paragraph have a bigger effect on the market with their irrational decisions based on fake news and FUD.

That’s the facts about Bitcoin: it’s entirely independent; it isn’t controlled by anyone or groups of people, and that’s why we can see that a lot of people like to introduce themselves into Bitcoin even in terms of investment or holdings. Because it is a reliable asset, if anyone has enough and keeps patient by holding it for a long period of time, it will bring out huge profits in the future; we should forget that the market is not stable by now; that is how the market goes at times, but in a few days later it will be better for investors.

I concur on the price not tied together with the stock market. But you made a mistake by saying they exist in the same environment.
Bitcoin exist in a different environment where what affects the price is not controlled by any central authority. Though it can be influenced a bit by some factors. On the other hand the stock market exist separately since most asset in the stock market are full controlled by the sole owners or government of a country.

I still stand on it that they do.
Every thing exists in an environment and there macro economic factors that affect everything in same environment.
Bitcoin is money, an investment and an asset
Any macroeconomic factors that affects all these Would likewise affect bitcoin.

You are right, the price of BTC is not tied directly but still stock market and other markets have impact on the price of BTC and other crypto sectors, it all depends on investors, if they find stock more profitable, they will sell their BTC and buy the stock and if they find crypto more profitable, they will sell their stocks and buy any crypto. Speaking of political and other fundamental factors affecting both markets, is not the same, but mostly they are, as most of us not really consider macro or microeconomic factors in crypto trading but in the stock market they do.

Failure of financial system will increase the adoption of BTC and Gold and other commodities, and that's for sure, we have seen one thing and that is if crypto is being more centralized and is connected more with financial system and fiat the more direct impact these things will have on crypto.

It most probably he means US stock market. I often saw Bitcoin follows US stock market's movement. It's anytime when US stock market dump, Bitcoin dump. When US stock market up, Bitcoin is going up as well. It clearly raises assumption if Bitcoin is now tied to the stockmarket.

Bitcoin should be treated as independent asset like gold. However, things changed when Institutional came in. Other than it, i guess it's also because almost all of parties are still treated Bitcoin as stock-like investment.

I personally believe that Bitcoin's main growth in value came from those institutional investors because they consider Bitcoin as an asset and that's the reason why it's somehow related to stock market. Bitcoin was initially created as a crypto currency a way to get centralized freedom and it was for everyone but things are somehow different now. Only a small group of people still use it as a payment system while most elites or institutional investors are in it due to its growth.

The fact that bitcoin has a volatile nature makes it hard for stock market analysts to find the exact propeller of the bitcoin market and very sure that bitcoin does not follow any centralized market trends so for that we can't say that bitcoin market depends on stock market realities, although the global trading market goes hand in hand and at that, we ought to pay close attention to all of that.


We can't exactly say which direction Bitcoin will take at whatever time but yeah we can just speculate, in all of that we also need to consider bitcoin's volatile nature.

Whatever happens in the world affects both the stock and the crypto markets.
Bitcoin IS a volatile speculative asset. I don't agree with your point that stocks are a speculative asset, while Bitcoin is more like a commodity. BTC is as speculative as all the other speculative assets. Such assets get easily affected by any disturbance on the financial markets. The high price volatility means that their prices are very sensitive to negative news and FUD.
Many "crypto experts" claim that BTC is following the same patterns as the stock market. I can partially agree with their point of view, but bear in mind that there are times, when BTC can go sideways and don't strictly follow the patterns of the stock market.

I definitely agree with your position.

First, OP has not specified which specific stock in which the price of BTC is in proportion at. Since the stock market comprises of several classes of corporations which vary depending on its price, you cannot generalize that the whole stock market is tied with the price of BTC.

Second, BTC and stocks are different in nature. Shares of stock are issued by the company upon its incorporation (for a non-stock corporation), while BTC comprises of 21 million which everything is yet to be mined. The number of stocks can be increased by the agreement of the corporation (and upon vote by 2/3 of its stockholders); while BTC cannot be further increased.

Lastly, the stock market is primarily governed by the country's SEC; while BTC is not governed by any regulatory department, agency, or government because the purpose of the latter is to free itself from any control.

The influx of institutional bodies into the Bitcoin market I know will have some effects existing investors will not likely be happy with and one of them is what's currently happening in Bitcoin coin price correlating with the stock market. The stock market is majorly dominated by these institutions who had deemed it necessary to also heavily invest in Bitcoin and because of the large amounts of Bitcoin in their possession now, there's no way they'll not have a or indirect direct effect on the price of Bitcoin. Bitcoin to them now is also stock-like investment and on daily basis, we'll continue to read the news of Bitcoin market caps on the international news lines like the CNN

I think @OP is correct, if compare graph of Bitcoin and S&P500, there's a similarity.

Both Bitcoin and S&P 500 hit ATH in 2022, then the price went down in the next year. Then both Bitcoin and S&P 500 made new ATH in 2025, but now both of them keep dropping till now.

So yeah, the market (people who bought it) of Bitcoin and S&P 500 are similar, gold have a different graph compared these two. https://goldprice.org/

https://imgvb.com/images/2025/03/30/b8460aa8fc83ff67bd06a8e5b158ef8e.png  https://imgvb.com/images/2025/03/30/d834fae1fd205eb48f1c8329d805f608.png

BTC and stocks are different in nature but the problem is that investors treat it as a speculative asset like stocks instead of treating it as a hedge asset like gold. And for speculative assets, they will try to manipulate, bump and dump, that's why bitcoin price is volatile, not because of its decentralized nature.


Bitcoin ETFs are approved and regulated by the SEC, and the majority of money flowing into bitcoin over the past year has been through ETFs. So don't be surprised to see the correlation between bitcoin and US stocks getting tighter.

Currently Bitcoin and stock market, especially NASDAQ, can be seen moving together. When the stock market grows, Bitcoin also increases, and when the stock market decreases, Bitcoin also decreases. But in fact Bitcoin is a completely different kind of asset. It’s not like a company or share, which depends on specific markets or tariffs. Bitcoin is a product like gold or oil, which is not in control of any person or company. Bitcoin is a coin that is under the control of someone directly block chain is extremely difficult.

A lot of those who have invested in stocks also invest in bitcoin which is probably why it gives the assumption that bitcoin's price is correlated to stocks. When in reality it is just because of how the investors think. If they are taking out their money in one investment they might want to take out their money from other investments as well.
To be fair, a lot of events could have an impact on bitcoin. Economic events, political events. As long as people react to it and they decide to do something with their bitcoins, the price will change.

I don't think your post is too logical.

People say Bitcoin and stock markets are correlated with each other by looking at relayed charts or correlation between two markets. I don't believe that people say it because they have experience and invest in both stocks market and Bitcoin market. It's only your thinking and backed by nothing.

Correlation between stocks market and Bitcoin market can be positive or negative and sometimes two markets move together with strong correlation but other times when Bitcoin is in its bullish parabolic months, stock market will be left behind.

And bitcoin have earned it self more recognition and that is why it keeps increasing in size and that is why people are rushing just to invest in bitcoin and since they are all virtual values and the fact that bitcoin and stocks are getting almost the same rating is actually giving me joy,  because for a very long time now bitcoin have not really gotten a good rating and this is because they don't exactly understand how the investment works.

People are found of jumping into conclusions especially when they don't understand what they are doing exactly because they have decided not to give knowledge a chance and this is one of the reasons why they judge even what they don't understand and they clearly don't want to understand. And even people that are using it as an option for payment is just there own initiatives, and since its a matter of choice, anyone can decide that.

Broader market affects the crypto market, that is all to it.

We can't ignore it, we can only look after the broader picture and keep the info to ourselves to analyze.

I CLEARLY SPECIFIED THE US STOCK MARKET LITERALLY WITHIN THE FIRST PARAGRAPH OF MY OP. Learn how to read!

I remembered I'd seen a graph about the exact correlation (NASDAQ-100 vs. Bitcoin) which also may tell us a bit about the causes for the grade of correlation (I had started a very similar thread (https://bitcointalk.org/index.php?topic=5505485.0) in the Spanish forum). It only covers up to mid-2024, but is nevertheless interesting:

https://talkimg.com/images/2024/08/09/5oHnw.png
Source: Coin Bureau (https://coinbureau.com/analysis/bitcoin-and-stock-market-correlation/)

Despairo has already shown us graphs where we can see that the macro movements (long term bear / bull) were indeed quite similar in the last years. But here we see the micro movements. And we can see that there seem to be some periods with a high correlation (late 2021 to early 2022 for example), while then in other phases (mid-2022, late 2022, late 2023 to early 2024), the correlation is lower.

My theory is that during the low-correlation phases there were standout crypto-related events and news driving the Bitcoin price, for example the Terra-Luna and FTX crashes in 2022 (bearish events) and the ETF approval in late 2023/24 (a very bullish Bitcoin event while the stock market ran sideways or only slightly bullish). In the remaining periods, traders are clueless about Bitcoin's fundamentals and thus "hang" to the stock market. I'll see if I find more recent data to confirm this assumption for 2025.

Edit: I remember that the correlation before ca. 2018 was quite low, and that's likely because there wern't professional traders and investors in the game yet. For example, 2014 and 2018, the major BTC bear markets pre-2020, were bullish (although with some volatility) in the S & P 500.

When investors fear to pour liquidity overall, surely they start to fear to pour it into the crypto market even more.

Be it NASDAQ, BTC, ETH, or any other asset, all I can say is that traders are ready to milk the market. So yes, while Bitcoin is not financially tied to any stock, the rise and fall of other stocks or coins being traded will still impact BTC because they operate in the same economic environment.

What I see happening here is simply a matter of demand theory.

If you believe that Bitcoin is a store of value, then it is logical to assume that the price of Bitcoin is highly dependent on the total money supply. Simply put, the more money there is in the world, the higher the price of Bitcoin.

When people have extra money that they cannot spend on everyday expenses - rent, utilities, food or clothing, they start investing. In doing so, they buy stocks or Bitcoin. How do you know if there is a lot of money in the world or not? Usually, a decrease in the discount rate (refinancing rate) leads to an increase in the total money supply, and its increase - on the contrary, to a decrease in the total money supply.

This is exactly the connection between the stock and cryptocurrency markets - both serve to accumulate (consolidate, sterilize) excess money supply, which would otherwise end up in the consumer market and lead to the fact that goods, works and services consumed by the population and organizations would sharply increase in price.

That is, the very presence of such entities as Bitcoin and stocks in the world allows you to control consumer inflation. This is the benefit of the stock and cryptocurrency markets for society.

We all believed that bitcoin is a store of value asset and it control by demand and supply. It is the demand that determine the supply and the availability of the demand and supply control the price. And in either ways people are benefiting from bitcoin. Both in decreasing time because people or investors would stuck their wallets with bitcoins and in the increasing time people would start selling to take profit.

Since Gold is not correlated with the stock market let bitcoin also be independent and not tied to the stock market and the tie is now affecting bitcoin because US is controlling the stock which is directly have impact on bitcoin. This macroeconomics tariff war has affected the stock and in turn to bitcoin.

It is simply because people are full of assumptions.  They simulate things on their mind and consider variable changes in the economy.  They will then create a theory of cause and effect that Bitcoin cannot escape.  Even though Bitcoin I believe is not directly correlated to many stocks on the market  (probably it has on some specifics)  Bitcoin is indeed affected by the ripple effects and the speculations especially when people behind wanted to show it that way.

We all know oftentimes there are players behind the scenes, and there are analyst that has wide imaginations making connections even if they don't really have.  With these two factors, manipulators (the one who works behind the scene) and theorist (the one who proposes the idea), once combined can establish a solid belief in one thing.  Thus people who have the attitude of being a sheep tends to follow the idea.

You are right first I thought that's not true and than I monitor stock market especially gold and when gold dumps than crypto market also dumps. So this is somehow not fair.

Bitcoin is recognized by the SEC not as a security but as a commodity like gold or oil. But the problem is how people treat it, most of them do not see it as an inflation hedge but as a form of get rich quick speculative investment. Trump's tariff war is putting pressure on the economy and could cause a recession, people are selling stocks and bitcoin in droves, and causing a selloff like what is happening. Meanwhile, gold prices are rising due to increased demand for safe havens.

It doesn't matter what purpose bitcoin was created for and what it is for, what matters is how we treat it. It was created to be a currency but we have turned it into an investment asset, similarly we are turning bitcoin into a speculative asset instead of a safe haven.