Cryptocurrency research institution NYDIG believes that the correlation between Bitcoin and tech stocks is significantly overstated in market discussions.
Rising Together Due to Macro Factors
Greg Cipolaro, Head of Research at NYDIG, stated that the recent simultaneous rise of Bitcoin and US software stocks is mainly due to changes in the macro environment affecting risk assets collectively.
Some market views suggest that Bitcoin and the tech industry are jointly exposed to risky themes like artificial intelligence or quantum technology, but Cipolaro argues that this explanation lacks sufficient evidence.
Stock Market Explains Only About 25%
Statistical analysis by NYDIG shows that only about a quarter of Bitcoin's price volatility can be explained by its correlation with the stock market.
At least 75% of the remaining price changes come from factors outside the stock market, such as the structure of the crypto market, liquidity conditions, and internal industry drivers.
Meanwhile, Bitcoin's correlation with the S&P 500 and the Nasdaq Composite has risen recently.
Ongoing Debate on Digital Gold Status
Cipolaro stated that Bitcoin is not yet widely regarded as a macro hedge asset by the market.
This also explains why, despite being called "digital gold," it has not consistently strengthened like gold in macro risk environments.
However, he believes Bitcoin can still serve as a diversification asset in an investment portfolio.
