Dave Portnoy, the inventor of Barstool Sports, asked if Bitcoin really is independent of the US stock market and went to the X platform.
Portnoy It was pointed out Repeated Pattern: Bitcoin price movements often reflect stock market prices. He said that when stocks rise, Bitcoin will rise and when stocks fall, Bitcoin will follow suit.
This has led to question whether Bitcoin is considered an asset that operates outside the traditional financial system, as it appears to act like other risky assets.
Bitcoin’s behavior amid the market turmoil
For context, the week leading to Trump’s “liberation day” announcement Customs It provides a notable example of the correlation between Bitcoin and the broader market. Bitcoin also fell sharply as stocks fell in Asia, Europe and the US.
The largest digital assets fell by 4.5% to around $81,770. Other cryptocurrencies, including Ethereum and XRP, saw similar declines.
Industry leaders respond
In response to these observations, Michael Saylor, executive chairman of strategy, presented his perspective. Saylor explained that Bitcoin’s short-term price movement was primarily due to its liquidity.
Bitcoin is the most liquid and sellable 24/7 asset on the planet, so it trades in the short term like a risky asset. In times of panic, traders sell what they can, not what they want. That doesn’t mean that it’s long-term correlation. But it means it is always available.
– Michael Saylor⚡️ (@saylor) April 4, 2025
He emphasized that in times of panic, traders often sell the most fluid and easily accessible assets. This explains why Bitcoin experiences price movements similar to stocks during market stress as the most liquid digital asset available 24/7. However, Saylor has made it clear that this does not imply a long-term correlation with the stock market.
Bitcoin volatility in particular is also a key reason for price fluctuations. Sven Henrich, financial strategist; It was pointed out The correlation between Bitcoin and stocks is primarily due to liquidity flows.
Currently, the monthly correlation between the two markets is above 90%, and Bitcoin usually shows greater volatility. Henrich said that Bitcoin prices could be affected by market conditions, but their role as a highly liquid asset contributes to these price fluctuations.
However, Henrich also acknowledged that Bitcoin volatility is not driven solely by market speculation. Its status as the most fluid digital asset means that it is more susceptible to market changes, especially during periods of increasing uncertainty.
The slow road to independence
Bitcoin price movements closely follow traditional financial market prices, but another market watcher agrees it may be too early to conclude that Bitcoin will always behave this way.
Jack Mac of Bar Stool Sports Proposed Bitcoin’s true independence will take time to achieve, especially given the involvement of large institutional investors. These institutions may continue to sell Bitcoin during periods of economic uncertainty, allowing them to further align their actions with the broader market.
At the same time, expert analyst Brett I believe The value of Bitcoin lies not only in its potential as a “value store,” but also in its technological innovation. For countries facing economic instability, Bitcoin has proven to be a hedge against the currency of a collapsed country.
ETFs have brought the correlation closer, which has been like this since its inception. It is a risk-on asset, most of the same capital flow, technology is the majority of the market today (by market capitalization) and check out the NVDA & BTC charts. They’re almost on top, dumping to …pic.twitter.com/nv40wn6qjj
– RETT (@brett_eth) April 4, 2025
Nevertheless, as long as institutional players are essential to the market, Bitcoin prices may continue to reflect the ups and downs of the stock market.
