Bitcoin correlation with U.S. equities has fallen to its weakest level since late 2022, according to market intelligence firm Santiment.
In a recent post on X, the firm explained that Bitcoin has historically moved in tandem with the S&P 500. For instance, when interest rates were low and economic growth was strong, as in 2021 and 2024, both stocks and digital assets advanced in parallel.
Conversely, during periods of uncertainty and aggressive Federal Reserve rate hikes in 2018 and 2022, crypto markets declined alongside equities. This pattern reinforced the view that Bitcoin often behaves like a risk asset.
Key Points
- Bitcoin has historically moved in sync with equities, rising during periods of strong economic growth and low interest rates.
- During crises and aggressive Fed rate hikes, such as in 2018 and 2022, Bitcoin has fallen alongside stocks.
- Since late August 2025, Bitcoin has sharply diverged: down 43%, while the S&P 500 rose 7% and gold surged 51%.
- This represents the weakest Bitcoin-stock correlation since the 2022 market turmoil.
- Santiment suggests that this decoupling is temporary and that Bitcoin could realign with equities if market conditions improve.
From Crisis Correlation to Market Divergence
The connection became especially clear in November 2022. At that time, surging interest rates coupled with the collapse of FTX, intensified market stress and accelerated capital flight from speculative assets. Bitcoin plunged to around $15,700, falling even more sharply than traditional equities.
According to Santiment, that episode underscored just how closely crypto markets were intertwined with broader financial conditions at the time.
Today, however, the landscape appears markedly different. Over the past six months, Bitcoin’s trajectory has diverged significantly from other major assets. Since late August, gold has rallied 51%, while the S&P 500 has gained 7%. In contrast, Bitcoin has fallen 43% over the same period.
As Santiment noted, this divergence represents the weakest correlation between Bitcoin and stocks since the turmoil of late 2022. Instead of tracking equity markets, Bitcoin has significantly underperformed. Meanwhile, traditional markets have remained relatively stable, and gold has attracted strong demand.
Historical Cycles and Potential Reconnection
Despite the unusual decoupling, Santiment cautioned that such divergences rarely last indefinitely. Financial markets tend to move in cycles, with capital rotating between asset classes as macroeconomic conditions and investor sentiment evolve.
When liquidity returns and risk appetite strengthens, assets that once moved together often realign.
Viewed in that context, the firm suggested the current disconnect could represent a longer-term opportunity. Specifically, should Bitcoin resume its historical tendency to follow equities during economic expansions, the asset may have room to recover.
Santiment pointed to three interest rate cuts in the second half of 2025 as a potential catalyst for renewed alignment between crypto and traditional markets.
For now, Bitcoin is trading at $65,237, up 3% over the past 24 hours, according to CoinGecko.
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