Bitcoin is on the rise while US markets, such as the S&P 500 are in decline. Bitcoin was highly correlated with the top US indexes. Some believed that spot Bitcoin ETFs could further tighten the correlation.
The correlation was broken as Bitcoin soared while the S&P 500 fell.
Source: Tradingview
Bloomberg reported on Wednesday that the current US administration was considering a Foreign Direct Product Rule (FDPR) in order to control chip equipment exported to China.
The financial markets also reacted to Donald Trump’s comments that Taiwan should pay for the United States’ protection.
CrowdStrike is a leading cybersecurity company. It released an update which caused a global outage. Banks, airlines and even hospitals were all affected.
Bitcoin, on the contrary, has seen strong inflows of funds from ETFs, as evidenced by Bitcoin supply backing ETFs.
source: dune
Trump’s (again) remarks about possibly using Bitcoin as strategic reserves for the U.S. has also contributed to BTC’s rally. The U.S. Government holds approximately 213,000 BTC.
Bitcoin was able to break free from the traditional financial market due to the above conditions.
Investors may consider Bitcoin a new safe haven asset if it continues to rise while US markets are falling. Bitcoin could see modest gains if it becomes a new safe-haven asset.
Will Ethereum have the same status as Bitcoins?
The inflows of BTC and spot ETH ETFs will be closely tracked once the approved ETFs have been listed for trading. While high inflows can impact ETH’s value, it is not yet clear whether it will be able to achieve the same status as Bitcoin.
For the moment, meme coins are still the most popular. SOL and ETH also rose in value as Bitcoin did.
BONK gained about 20%, while Turbo gained 25%. Aptos (L1s), and Solana, both unrelated to BTC, also rose. It shows that a Bitcoin rally may be enough to ‘push up’ the crypto markets.
Next week, all eyes will be on Ethereum and whether or not the ‘de-pegging of BTC from S&P 500’ is sustainable.
This site is intended for entertainment only and does NOT offer financial advice.
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