The correlation between cryptocurrencies and U.S. stocks and macro events is weakening, and the cryptocurrency market appears to be between bulls and bears, waiting for “any further catalysts,” Bernstein analysts said.
Crypto markets are not as sensitive to traditional markets as they used to be, with the correlation between Bitcoin and stocks falling steadily throughout the year, with the correlation between Bitcoin and the Nasdaq Composite down from 0.94 in early February to 0.58 now .
Analysts also believe that a weakening correlation with the U.S. will lead to a bull market for cryptocurrencies. “A significant portion of stablecoin issuance (>50%) and global cryptocurrency trading (95%) remains outside the U.S. market,” analysts said in the report.
As such, the crypto market is driven by more global flows than U.S. flows. “
