Bitcoin and stocks, particularly tech stocks, have been moving in lockstep for years. But just because bitcoin surged to a new high this week doesn’t indicate stocks will do the same.
Although stocks and cryptocurrency have long been seen as dangerous investments, there have been significant price fluctuations in 2025. Although analysts felt it was too soon to call for a decoupling, Bitcoin (BTCUSD) proved more resilient than stocks during the market turmoil earlier this year caused by concerns over President Donald Trump’s tariff policy.
Read: Amid tariff unrest, bitcoin beats markets and the dollar, making it “too early” to declare it a safe haven.
Furthermore, Jay Hatfield, the CEO and chief investment officer at Infrastructure Capital Advisors, believes that the current performance of bitcoin is probably not a reflection of a traditional risk-on tone. According to Dow Jones Market Data, the biggest cryptocurrency hit a record high of $111,986 on Thursday before dipping little to over $108,700 on Friday.
Hatfield stated in emailed remarks that the spike in bitcoin was instead more motivated by hope for a more lenient regulatory environment for cryptocurrencies under the Trump administration. He claimed that while such shifts have been seen as positive for cryptocurrencies, they are unrelated to stocks.
Following the three major indexes’ worst day in a month on Wednesday, U.S. stocks SPX closed Thursday largely unchanged. Stocks have been impacted by a rise in Treasury yields BX:TMUBMUSD10Y as well as worries that Trump’s massive tax measure, which House Republicans passed Thursday morning, could increase the U.S. deficit.
Crypto supporters have long maintained that bitcoin may someday function as a store of value and a hedge against expansionary fiscal and monetary policies, even though markets can fluctuate dramatically, as they did on Thursday.
More institutions have been putting more of their investments into cryptocurrency, which supports that claim. Michael Green, chief strategist at Simplify Asset Management, speculates that they might be reducing their stock allocation in order to achieve this.
The largest asset manager in the world, BlackRock, increased its target allocation portfolios that allow for alternatives by 1% to 2% in February. This allocation was made to its iShares Bitcoin Trust ETF IBIT. According to reports on Wednesday, the team also decreased its overweight to stocks to 1% more recently after reducing it from 4% to 3% at the time.
Regarding policy, a number of states have been moving to create bitcoin reserves. A bill to create a strategic bitcoin reserve was approved by the Texas House of Representatives on Wednesday. Before reaching the governor’s desk, the law must now pass a procedural vote.
A bill authorizing the investment of some state funds in digital assets was signed into law by New Hampshire Governor Kelly Ayotte earlier this month.
These initiatives are similar to Trump’s executive order to establish a federal bitcoin reserve in March, which stoked enthusiasm among cryptocurrency aficionados.
New legislation aimed at regulating stablecoins—a kind of cryptocurrency whose value is based on another asset—was headed to the Senate for a vote, which would increase the potential tailwinds for the industry.
Crypto bulls believe that if the plan is passed into law, it might encourage more people to use stablecoins linked to the dollar and advance the integration of cryptocurrency assets with the current financial system.
