Bitcoin Decouples from Stocks and Gold, Driven by Renewed ETF Demand and Short Squeezes

Bitcoin has decoupled from traditional assets such as stocks and gold, according to Santiment analysts. The cryptocurrency's market capitalization has increased by 36% since August 18, compared to a 0.8% gain in the S&P 500 and a 1.5% drop in gold.

The five-week divergence between Bitcoin, the stock market, and gold suggests that the cryptocurrency is now trading on its own drivers, rather than being influenced by traditional markets. This decoupling has been attributed to renewed ETF demand, rising liquidity, and a series of short squeezes.

CryptoQuant highlights another signal: recent rebounds in Bitcoin's price happened without the participation of Korean retail investors. The Kimchi premium, which measures the gap between Bitcoin prices on Korean and international venues, narrowed and flipped to a discount when Bitcoin broke above $82,000.

Santiment notes that equity indices remain near record highs but are facing higher rates and uneven investor participation. Gold is under pressure amid expectations of a longer period of tight monetary policy. Analysts point out that rising leverage and euphoria among market participants increase the risk of a short-term market shakeout.