Bitcoin Lags as Investors Flock to Traditional Stocks
The Essentials at a Glance
In recent weeks, investor behavior has changed significantly. While Bitcoin (BTC) has recently lost momentum, interest is increasingly shifting toward traditional stock markets. Global liquidity, an important indicator for capital inflows into risk assets, is once again negative. This development has a direct impact on the demand for cryptocurrencies. Particularly striking: Bitcoin has recently failed to keep up with the performance of major U.S. stock indices.
Global Liquidity Under Pressure
The balance sheets of major central banks have noticeably declined over the past month. These figures are considered an indicator of the available liquidity in financial markets. When liquidity decreases, capital is withdrawn from riskier assets such as cryptocurrencies or growth stocks. That is exactly what is currently being observed.
Bitcoin has historically benefited from periods of expansive monetary policy, such as during the COVID-19 crisis of 2020–2021. In times of restrictive monetary policy – as is the case now – BTC comes under pressure. The result: investors avoid risky assets and increasingly turn to established stocks.
Bitcoin Losing Market Strength
A look at the ratio between Bitcoin and the S&P 500 shows: BTC is currently lagging behind. While the U.S. stock index is fluctuating near its all-time highs, Bitcoin has seen little to no gains over the past two weeks. The BTC/SPX ratio has fallen below the important threshold of 18 – a technical level that serves as an indicator of relative strength.
During times of political uncertainty, such as the recent trade disputes, Bitcoin was able to benefit in the short term. However, this effect was not sustainable. Without a return above the 18 mark, BTC remains vulnerable to further setbacks – especially if liquidity continues to decline.
Changing Investor Risk Appetite
The current market situation shows a shift in risk appetite: investors currently prefer traditional stocks over cryptocurrencies. This development is not unusual during periods of economic uncertainty or restrictive monetary policy. Should the macroeconomic environment ease, Bitcoin could regain strength.
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A further decline of the BTC/SPX ratio below 17 would be a clear warning signal. At the same time, the area around 16 remains an important support level. Whether Bitcoin can reclaim its leadership role in the market will strongly depend on the further development of global financial markets.
Our Assessment
The current weakness of Bitcoin is not an isolated case but part of a broader trend. Declining global liquidity and cautious investor sentiment are weighing on risk assets. Stocks are currently benefiting from this shift. For you as an investor, this means: keep an eye on the BTC to S&P 500 ratio and watch for macroeconomic signals. If the environment improves, Bitcoin could regain momentum. Until then, caution is advised.
| Symbol | BTC |
| Coin type | Alt Coin |
| Transaction Speed | Slow |
| Pros |
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| Cons |
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| Further practical applications | |
| Price | 105604 |
| 24h % | 1.13 % |
| 7d % | 1.33 % |
| 30d % | 2.55 % |
| 60d % | 38.94 % |
| 1y % | 52.11 % |
| Market Cap | $2,098,974,831,426.00 |
| Max. Supply | 21,000,000.00 |
| Official Links | Website | Whitepaper | Source Code |
| Socials | Reddit | X | Message Board |
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