The Crypto–Equities Correlation Is Breaking Down. Why It Matters
BTC's 90-day correlation with the S&P 500 has fallen to the lowest level in three years.
Bitcoin's 90-day correlation with the S&P 500 has fallen to roughly 0.18, the lowest reading since early 2022. The shift suggests crypto is increasingly trading on its own flows — ETF demand, halving cycle dynamics, and macro hedging — rather than as a high-beta tech proxy.
Allocators we surveyed are taking notice. Several family offices that had treated crypto as a "risk-on" satellite are reconsidering position sizing in light of the diversification benefit. The treatment of BTC as a standalone macro asset — rather than a 1.5x NASDAQ — has implications for portfolio construction.
Caveats apply. Correlations spike during liquidity events, and the relationship can rebuild quickly if a macro shock dominates flow dynamics. But for now, the breakdown is real and persistent.