After moving in tandem over the last four years, Bitcoin (BTC) has decoupled from the Nasdaq index as the hype surrounding crypto exchange-traded funds (ETF) grows more intense.
The 40-day correlation between Bitcoin and the Nasdaq exchange now stands at zero, indicating a lack of relationship between the two asset classes, according to market data.
The correlation between the largest cryptocurrency by market capitalization and the technology-laden index had been consistent since the Covid-19 pandemic struck in early 2020.
However, that correlation has now been broken as the price of Bitcoin continues to rise sharply on expectations that market regulators are about to approve spot Bitcoin ETFs in the U.S.
The U.S. Securities and Exchange Commission (SEC) is likely to decide on nearly a dozen Bitcoin ETF applications by Jan. 10. It’s believed that approval will attract billions of dollars in fresh capital.
Since September 2023, the price of Bitcoin has risen 84% to its current level of $46,200 U.S. That brings Bitcoin’s gain over the last 12 months to nearly 170%.
By comparison, the Nasdaq index has increased 40% over the past year, registering one of its best years ever in 2023 but trailing the rise in Bitcoin
