- Bitcoin and S&P 500 lost their correlation following the ETF launches.
- While the S&P 500 continues to climb higher, Bitcoin has seen a steep decline in its price.
- Arthur Hayes said BTC’s performance indicates there might be hiccups ahead.
As Bitcoin lingers in the bearish zone, BitMEX co-founder, Arthur Hayes pointed out that the flagship cryptocurrency asset has lost its correlation with the S&P Index — an index that tracks the price of the largest stocks in the US market.
In a recent tweet on social media platform X (formerly Twitter), Hayes noted these changes started following the launch of spot Bitcoin exchange-traded funds (ETF) in the United States. The highly anticipated ETF launches came on January 11, after the US Securities and Exchange Commission (SEC) approved all pending applications.
According to Hayes, the divergence in BTC and S&P price movements indicates different future expectations. While referencing a snapshot showing the price movements, Hayes said, “BTC is telling us that there are hiccups ahead for $.”
However, the founder said certain metrics expected to come out by the month’s end will indicate whether there are bearish concerns ahead. “Next signpost is 31st January US Treasury refunding announcement,” Hayes concluded.
After a sporadic rise in the aftermath of the ETF approval, Bitcoin saw a steep decline in its price. The decrease in the asset’s price wiped off gains the flagship cryptocurrency garnered over previous weeks. At the time of this writing, Bitcoin is trading at $40,933, according to data from CoinMarketCap.
Despite Bitcoin’s bearish performance, the recently launched ETFs continue to draw interest from investors. At the close of trading last week, two of the ETFs had already raked in over a billion within the week, as earlier reported. Prevailing expectations are that the ETFs will continue to see capital inflow in the coming weeks.
However, Bitcoin’s reaction to the ETF’s approval negated analysts’ expectations. Importantly, the ETF launches, which institutionalize Bitcoin as a mainstream asset, were expected to increase the token’s price. Nonetheless, analysts continue to predict Bitcoin will hit an all-time high of around $100K before the year’s end.
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