The United States seems to be leading in Bitcoin adoption, with an analysis showing a strong correlation between the asset and the indigenous stock market.
Before winning the November 2024 elections, Donald Trump promised to make America the crypto capital of the world. As he progresses with this ploy, recent analysis indicates that the US market is already fastening its ties to Bitcoin’s price action.
Data from CryptoQuant shows that institutional investors have indigenized Bitcoin, viewing the asset more like a traditional investment vehicle in the US market. Notably, the adoption curve has culminated in a strong correlation between the stock market and the pioneering cryptocurrency.
Fastened Correlation Between Bitcoin and US Asset Classes
CryptoQuant’s analysis shows that Bitcoin has fastened its price performance in correlation with notable US asset classes like the S&P 500 and Nasdaq. The market intelligence firm noted that this convergence started in 2024, recently reaching unprecedented levels.
Notably, an accompanying chart shows the strong correlation, especially between Bitcoin and Nasdaq. Per the chart, the convergence started around June 2024, and their price action has moved closely since then.
The firm also shows a similar correlation between Bitcoin and the S&P 500. However, it noted that the pair have decoupled several times along the line, compared with Nasdaq.
Meanwhile, the Bitcoin correlation with the US market surfaced following its over 5% short-lived crash to below $98,000 on Monday amid broader stock declines. The capitulation, which saw asset classes like the S&P 500 and NVIDIA crash substantially, came from China’s launch of DeepSeek, an AI tool teased to be better than American-based ChatGPT at much cheaper costs.
Verified CryptoQuant analyst Darkfost suggested that the close correlation indicates a growing adoption of Bitcoin among institutional investors. He noted that these high-caliber market participants now see the crypto firstborn as a traditional asset class.
In truth, US institutions have had a paradigm shift in their view of Bitcoin. Corporate firms and investment institutes in the country have incessantly invested in Bitcoin, increasing their market exposure to the premier asset.
More Adoption on The Horizon
Meanwhile, Darkfost suggested that further correlation, spurred by more adoption, is on the horizon. Specifically, he cited easing regulatory infringements due to a more transparent environment as a factor that would drive more institutional adoption.
The analyst cited the US Securities and Exchange Commission’s (SEC) repulsion of the Staff Accounting Bulletin (SAB) 121 as a driving force. For context, the new SEC leadership dismissed the accounting restrictions discouraging financial institutions from holding cryptocurrencies upon changes in the agency’s hierarchy.
The warming environment this repulsion is set to bring, will be crucial in further adopting Bitcoin in the United States. Meanwhile, plots to create a national Bitcoin stockpile have sparked increased Bitcoin acquisition, and market observers believe the bullish news is not oversold yet.
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