Dave Portnoy, the inventor of Barstool Sports, has gone to the X platform, asking whether Bitcoin is truly independent from the U.S. stock market.
Portnoy pointed out a recurring pattern: Bitcoin’s price movements often mirror those of the stock market. He noted that when equities rise, Bitcoin rises, and when stocks fall, Bitcoin follows suit.
This has led him to question whether Bitcoin can still be considered an asset that operates outside traditional financial systems, as its price seems to behave just like other risk assets.
Bitcoin’s Behavior Amid Market Turmoil
For context, the week leading to the announcement of Trump’s “liberation day” tariffs provides a notable example of Bitcoin’s correlation with the broader market. As equities tumbled across Asia, Europe, and the U.S., Bitcoin also experienced a significant drop.
The largest digital asset fell by as much as 4.5%, reaching approximately $81,770. Other cryptocurrencies, including Ethereum and XRP, saw similar declines.
Industry Leaders Response
In response to these observations, Michael Saylor, Executive Chairman of Strategy, presented his perspective. Saylor explained that Bitcoin’s short-term price movements are largely due to its liquidity.
Bitcoin trades like a risk asset short term because it’s the most liquid, salable, 24/7 asset on Earth. In times of panic, traders sell what they can, not what they want to. Doesn’t mean it’s correlated long-term—just means it’s always available.
— Michael Saylor⚡️ (@saylor) April 4, 2025
He emphasized that, during times of panic, traders often sell assets that are the most liquid and easily accessible. This explains why Bitcoin, as the most liquid digital asset available 24/7, may experience price movements akin to stocks during market stress. However, Saylor clarified that this doesn’t imply a long-term correlation with the stock market.
Notably, the volatility of Bitcoin has also been a key reason for its price fluctuations. Sven Henrich, a financial strategist, pointed out that Bitcoin’s correlation with equities is largely due to liquidity flows.
Currently, the monthly correlation between the two markets is above 90%, with Bitcoin typically showing greater volatility. Henrich noted that while Bitcoin’s price can be affected by market conditions, its role as a highly liquid asset contributes to these price swings.
However, Henrich also acknowledged that Bitcoin’s volatility is not solely driven by market speculation. Its status as the most liquid digital asset means that it is more susceptible to market changes, particularly during periods of heightened uncertainty.
A Slow Path Toward Independence
While Bitcoin’s price movements have closely followed those of traditional financial markets, another market watcher agrees it may still be too early to conclude that Bitcoin will always behave this way.
Barstool Sports’ Jack Mac suggested that Bitcoin’s true independence will take time to materialize, especially given the involvement of large institutional investors. These institutions may continue to sell Bitcoin during times of economic uncertainty, further aligning its behavior with the broader market.
At the same time, expert analyst Brett believes that Bitcoin’s value lies not only in its potential as a “store of value” but also in its technological innovation. For countries facing economic instability, Bitcoin has proven to be a hedge against collapsing national currencies.
While the ETFs have made it closer of a correlation, it’s been like this since inception. It’s a risk-on asset, it’s most of the same capital flow, tech is a large portion of the markets today (by market cap), etc check out the NVDA & BTC chart. They nearly top and dump at the… pic.twitter.com/NV40wN6qJJ
— ₿rett (@brett_eth) April 4, 2025
Nevertheless, as long as institutional players remain integral to the market, Bitcoin’s price may continue to reflect the ups and downs of the stock market.