Bitcoin Surges 22% in August: Is it Breaking Free from Stocks?
Bitcoin experienced a significant surge in August, increasing by 22% while the Nasdaq barely moved 5%. This shift has sparked debate on whether Bitcoin is decoupling from its traditional risk-asset behavior. Scott Melker argued that Bitcoin's changing correlations show it remains largely uncorrelated over longer periods, potentially aiding portfolio diversification.
Bitcoin's correlation with gold has risen sharply as its link with stocks has weakened. Melker cautioned that these shifts may not last and that Bitcoin can move in tandem with both stocks and gold without being tied to either over the long term.
The crypto king's rally came at a time when U.S. spot Bitcoin ETFs recorded about $731 million in daily inflows, the strongest since January. Melker pointed out that a break above $82,800 would mark a higher high and strengthen the bullish structure.