Bitcoin's correlation with the Nasdaq reaches its highest level in two years, exceeding 0.70 according to Bloomberg data. This timing comes at a critical time, as markets hold their breath ahead of the release of the next U.S. Consumer Price Index (CPI) report.
A historic Bitcoin – Nasdaq correlation that worries the markets
On January 15, analysts observed a correlation above 0.70 between bitcoin and the Nasdaq 100 index, a level not seen since 2023. This synchronization comes as the bitcoin briefly exceeded $100,000marking his first return to this level since January 7.
Jag Kooner, head of derivatives at Bitfinex, warns against possible increased volatility, highlighting that higher-than-expected inflation could lead to a simultaneous correction in the stock and crypto markets.
Bitcoin's sensitivity to macroeconomic data has strengthened significantly in recent months, reflecting its maturation as a financial asset. Institutional investors, now major players in the crypto market, are increasingly aligning their strategies with traditional economic indicators, thus strengthening this correlation.
This growing interconnectedness raises questions about bitcoin's ability to maintain its safe-haven status in the face of inflation, initially one of its core promises.
The shadow of the Fed looms over the crypto market
Bitcoin's recent correction below $92,500 is mainly due to concerns related to the monetary policy of the US Federal Reserve. Ryan Lee, chief analyst at Bitget Research, attributes the decline to strong U.S. economic data, which suggests high interest rates may remain high for longer than expected.
Crypto markets demonstrate particularly strong responsiveness to monetary policy prospects. According to experts, they incorporate expectations of rate changes more quickly than traditional assets, acting as an “accelerated beta” of macroeconomic conditions.
The CME Group's FedWatch tool currently indicates that markets anticipate a first rate cut for June 18, 2025, a date that could significantly influence the trajectory of bitcoin in the months to come.
The growing convergence between cryptos and traditional markets marks a new era for BTC, now more integrated than ever into the global financial system. This development, although it demonstrates its maturity, also makes it more vulnerable to macroeconomic turbulence.
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