Bitcoin’s price performance was mixed last week, rising to a new all-time high at one point before settling around the $105,000 mark. While price action may have been somewhat slow last week, there is a growing positive sentiment around the leading cryptocurrency – something that has been missing in the first two weeks of 2025.
This latest wave of optimism has seen the world’s largest cryptocurrency by market capitalization continue to spread its wings in the global financial markets. Interestingly, the latest data shows that the correlation between Bitcoin price and the US stock market has reached a new high.
What does increasing correlation mean for BTC and investors?
In a Quicktake post on the CryptoQuant platform, an analyst with the pseudonym Darkfost open The price of Bitcoin has remained closely linked to the performance of the US stock market. According to data from CryptoQuant, the correlation between Bitcoin price and the Nasdaq reached a new all-time high on Saturday, January 25.
To clarify, the Nasdaq Composite Index is a stock market index that tracks the value of almost all stocks listed on the Nasdaq Stock Exchange. Along with the S&P 500 and the Dow Jones Industrial Average, the NASDAQ ranks as one of the most popular stock market indices in the United States.
Source: CryptoQuant
Darkfost highlighted that the price of Bitcoin and the Nasdaq index showed a historically strong correlation in 2024, continuing this trend into the new year. Likewise, the price of Bitcoin and the S&P 500 have been closely correlated in the past year, although there have been short periods of separation.
According to a Quicktake analyst, the increasing correlation indicates that institutional players are now more open to BTC as an asset class, aligning its performance with traditional market trends.
Darkfoust added:
With Trump now in charge, expectations of relaxed regulations, such as the repeal of SAB 121, could further strengthen Bitcoin’s position as a recognized asset class among institutional investors, potentially accelerating its adoption.
The relationship between US stock markets and Bitcoin has always been interesting, as it offers diverse investment opportunities. However, the strong relationship between these two asset classes narrows the diversification opportunities they often offer investors.
Bitcoin price at a glance
As of this writing, Bitcoin is at around $104,900, reflecting the lack of significant price movement in the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image created by Dall.e, chart from TradingView
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