Bitcoin Wins Back Footing Against S&P 500
Bitcoin's performance against the S&P 500 has improved significantly in recent months. After hitting a six-year low in mid-August, when its three-month session win rate against the S&P 500 sank to 37.8%, Bitcoin has regained its footing. In September, the asset gained roughly 7%, while the S&P 500 was essentially flat, moving between 0% and 0.3%. This shift has caused Bitcoin's win rate to climb back above 50%, indicating that individual demand for the asset is increasing.
According to Glassnode data, Bitcoin's market capitalization has risen approximately 36% since mid-August, while the S&P 500 gained 0.8% over the same period. The asset has also strung together three consecutive weeks of outperforming the index in September. Analysts at Santiment reported that Bitcoin is now moving independently of stocks, with its correlation to the S&P 500 effectively broken. Bitcoin's 260-day correlation with the index now sits at its lowest level since 2015.
The return of smaller holders who sold out in mid-August has added a meaningful source of demand to the market. US spot Bitcoin ETFs posted multiple strong days of net inflows in September, coinciding with Bitcoin's relative strength against equities. This influx of institutional money is a positive sign for the asset, but the retail angle deserves some caution. Smaller holders tend to chase momentum, selling into weakness and buying back into strength, which can be fickle when the price stops cooperating.
The debate over which asset better serves as a store of value is likely to continue, with gold down more than 6% in September while Bitcoin climbed roughly 7%. The key metric to track is whether the win rate can hold above 50% over the coming weeks, and the correlation figure is another gauge to monitor. If it stays near its lowest level since 2015, investors may increasingly treat Bitcoin as its own asset class, with its own drivers and its own risks.