In the current cycle, $BTC
still behaves as a risk-on asset with a high beta relative to traditional markets (S&P 500, Nasdaq). This means that even without negative crypto news (such as hacks, regulatory bans, or scandals), declines in the US stock market trigger a correction in BTC due to the overall risk-off dynamics (reduced risk appetite).
Why is this happening?
Strengthening correlation: In 2025, BTC's average correlation with the S&P 500 is 0.5 (vs. 0.29 in 2024), and with the Nasdaq, it is 0.52 (vs. 0.23). BTC reacts to macro factors: pauses in Fed rate cuts, rising yields, inflation, or fears of an AI bubble. Institutional factor: BTC is included in traditional portfolios through spot ETFs (~$100–103 billion AUM) and corporate holdings (MicroStrategy, etc.). During rebalancing or risk-off, institutions reduce exposure to risky assets, including BTC → ETF outflows → selling pressure.
High-beta effect: BTC is an "amplified version" of risk assets: it falls more than the market (for example, -29–36% from the peak in Q4 2025 with moderate corrections in the Nasdaq/S&P).
Liquidity and sentiment: During risk-off, capital flows to safe havens (gold, bonds), reducing liquidity in crypto. Even without crypto news, this causes liquidations and amplified drawdowns.