Institutional Investors Questioning the Growing Correlation Between Bitcoin and Tech Stocks

Sygnum Bank recently questioned the “digital gold” narrative of Bitcoin (BTC) amid its underperformance in the market.

The narrative of Bitcoin (BTC) as “digital gold” has been questioned by Sygnum Bank amid the cryptocurrency’s lagging performance in the market,

This comes as the Swiss digital asset bank observed that BTC's price movements have been closely tracking those of high-risk tech stocks, rather than showing the expected lack of correlation with traditional markets as a safe haven asset.

Sygnum Bank noted that the flagship cryptocurrency has been positioning itself as the poster boy of the crypto market.

Its analysis follows recent commentary from Barstool Sports founder Dave Portnoy, who has also expressed skepticism over the growing correlation between Bitcoin and tech stocks.

“If the point of Bitcoin is to be independent of the US Dollar and non-regulated, why does it basically trade exactly like the US stock market nowadays?” asked Portnoy on X.

“Market up, Bitcoins up. Market down, Bitcoin down.”

Strategy Executive Chairman Michael Saylor Explains Latest Criticisms on BTC

In response to Portnoy’s observation, Michael Saylor, a Bitcoin maxi (maximalist) and co-founder of the most successful Bitcoin development company by far, chimed in with an explanation.

According to Strategy’s executive chair, BTC trades like a risk asset in the short-term because it’s the most liquid, salable, 27/4 asset on earth.

This allows traders and investors to sell their BTC holdings whenever possible, especially during market panic. Hence, it’s vulnerable to the short-term knee-jerk reaction from holders. However, the same does not hold true in Bitcoin’s long-term actions.

Historical data shows that Bitcoin has always achieved new all-time highs at each halving cycle every four years. In its first halving, the crypto asset spiked over $1K. Then, it exceeded $10K in the second cycle and $69K in the third cycle.

Currently, Bitcoin is in its fourth halving cycle. Thanks to its broader institutional adoption and optimism following the win of the first pro-crypto president in the US, it managed to log a new ATH of $109K last January.