Bitcoin's August Surge Sparks Decoupling Debate

Bitcoin surged by 22% in August as stocks stalled, sparking debate about whether the cryptocurrency is decoupling from its traditional risk-asset behavior. Scott Melker pushed back on the idea that Bitcoin needs to track either equities or gold, arguing that it remains largely uncorrelated over longer periods and can help portfolio diversification.

The correlation between Bitcoin's price and gold has risen sharply, while its link with stocks has weakened. However, Melker cautioned that these shifts may not last, and Bitcoin can move with both stocks and gold without being tied to either in the long term.

Bitcoin's rally came as U.S. spot Bitcoin ETFs recorded about $731 million in daily inflows, the strongest since January. A break above $82,800 would mark a higher high and strengthen the bullish structure, according to Melker.