- Bitcoin was up by 5.95% over the past 24 hours until press time.
- The king coin has been highly correlated with the stock market since August 2024.
Since the announcement of global tariffs six days ago, the U.S. market has seen a sharp decline, with the S&P 500 seeing three consecutive days of decline.
These conditions within the stock market have had far-reaching impacts on the crypto market. Inasmuch, CryptoQuant analyst Frost has suggested that Bitcoin is highly correlated with the stock market.
How much is Bitcoin correlated with the stock market?
According to CryptoQuant, Bitcoin has shown a high correlation with the S&P 500. At press time, the correlation ratio had evolving around 0.8, which indicates the crypto is highly correlated with these assets.
Since September 2024, Bitcoin and the S&P 500 have remained closely correlated.
Source: CryptoQuant
The correlation remains the same between Nasdaq and BTC, and has remained intact since mid-August 2024. At press time, the ratio sat around 0.8, signaling considerable correlation between the two markets.
This correlation is even more constant than that of the S&P 500.
Source: CryptoQuant
This correlation has become more prevalent as the global market crashed, following widespread tariffs.
The same pattern was seen the past day after speculation of a 90-day tariff pause. As such, all major indexes surged from this speculation, with the Nasdaq composite rising by 0.1% as tech-related stocks recovered.
The same happened with Bitcoin, which surged to a high of $81180.
Source: Checkonchain
Looking at comparative rolling performance, BTC, SPX, and NDQ have both followed the same pattern through March and April 2025.
Over this period, all these assets declined, suggesting that there’s a strong market correlation arising from macroeconomic stress and risk-off sentiment.
Source: Checkonchain
This is further validated by Bitcoin’s relative drawdowns, where BTC has followed the same correlation risk with other assets. Drawdowns are synchronized with equities, hinting at risk-on/risk-off macro sentiment correlations.
Therefore, the recent market performance shows that there’s no doubt, BTC is still highly correlated with the stock market.
What’s next for BTC?
According to AMBCrypto’s analysis, Bitcoin is currently highly correlated with stock markets. Therefore, if stock markets see extreme volatility and uncertainty, the same fate will face Bitcoin.
Conversely, a recovery in macroeconomics and stock markets means institutional investors are strong enough, thus boosting BTC to higher prices.
If recent uncertainty in the stock market persists, BTC will continue fluctuating with $74k as a strong support level. Conversely, if the market cools down restoring confidence among investors, BTC will reclaim $82500.
