Bitcoin Compared to the Stock Market: Michael Saylor Explains the Short-Term Correlation

Since February, when Donald Trump officially announced his aggressive tax plan, the U.S. economy has been in turmoil. At the beginning of that month, the S&P market was at $5,969.58. Since then, the market has fallen by at least 9.5%. Similarly, the Nasdaq 100 index has decreased by more than 12.14%. Surprisingly, Bitcoin, often seen as a hedge against market instability, has followed the trend of the US stock market during this period, as it has fallen by about 18.49%. Meanwhile, during this period, gold has increased by no less than 10.47%. The development has sparked lively debates about whether Bitcoin is truly an independent asset. Now, co-founder of Strategy Michael Saylor, a passionate supporter of Bitcoin, shares a very convincing argument for why he believes the correlation between U.S. stocks and Bitcoin is a temporary phenomenon. Curious to know more! Read on! Does Bitcoin Really Have Independence? Bitcoin is one of the digital assets that benefits from changes in the political climate of the United States. At the beginning of November 5, 2024, the lowest price of Bitcoin was $67,772.62. From November 5 to November 22, 2024, the BTC market increased by more than 45.80%. On December 17, 2024, it reached its yearly peak of $108,389.70. In early January 2025, the Bitcoin market fluctuated between $89,310 and $106,395.41. On January 20, the market reached a new all-time high of $109,000.

After Donald Trump took office as President of the United States - especially after he announced strong tariff policies, the market lost its upward momentum, reflecting the general trend in the U.S. stock market. Since February, the market has fallen by more than 18.49%, raising serious concerns about its position as a reliable risk hedging tool amid market volatility. This development has sparked intense debates about whether Bitcoin is an independent asset or not. Short-Term vs Long-Term: The Dual Nature of Bitcoin Co-founder and strategist Michael Saylor dismissed any claims questioning the reliability of Bitcoin as a trustworthy hedge against market volatility, stating that the correlation between Bitcoin and the U.S. stock market is merely a temporary phenomenon.

He argued that the high liquidity and 24/7 usability of Bitcoin make it a convenient asset to sell during times of market downturn. He asserted that when people panic, they sell whatever they can and Bitcoin can always be sold. He emphasized that this short-term correlation does not mean that Bitcoin is tied to the stock market in the long term. He reinforces the idea that in the long run, Bitcoin could still be a non-correlated asset – an independent asset. In 2024, the Bitcoin market saw a growth of 121.1%. In the same year, the S&P 500 index only increased by 24.05% and the Nasdaq 100 only rose by 27.10%. During the same period, the gold market only grew by 27.54%. In summary, as discussions around Bitcoin’s market behavior continue, one thing is clear: its short-term volatility does not undermine its long-term potential.