Bitcoin Breaks Six-Year Trend, Surges Past S&P 500 Index

The cryptocurrency market witnessed a significant shift in trends last week as Bitcoin (BTC) surged by 25% within two days, reaching almost $80,000. This impressive recovery marked a turning point for BTC, which had underperformed the S&P 500 index on approximately two out of every three trading days over the past three months.

According to Glassnode, this was the longest streak of relative underperformance by BTC against the benchmark US index in six years. However, on Wednesday, the trend reversed, with BTC posting a notable gain while the S&P 500 and Nasdaq slipped into losses.

The magnitude of BTC's excess returns during its better days has been considerably larger than that of the stock market, which is evident from the recent deviation. While it would be premature to conclude that there's a decisive decoupling between BTC and US equities, the cryptocurrency has historically traded as a high-beta risk asset.