Crypto Reverts to Tech-Stock Trade as Nasdaq Correlation Rises
Crypto is increasingly trading in tandem with Nasdaq-listed tech stocks, which is driven by high correlation levels that treat Bitcoin like a high-beta tech asset. The correlation peaked near 0.80 recently. This level has been the highest since 2022. This has wide implications for the investors as it reduces crypto’s diversification benefits during market downturns.
At this point, where Donald Trump’s tariff announcements are causing havoc to the global economy, cryptocurrencies, especially Bitcoin, are trading like any other tech stock, making it a risky asset for investment. According to Adrian Fritz, the Chief Investment Strategist at 21Shares, Bitcoin’s correlation with the Nasdaq and S&P 500 stresses its role as a macro-sensitive asset, which is driven by institutional behavior and policy shifts. As it is synonymous with tech stocks, Bitcoin trading also puts forth synchronized trading patterns. Research shows that this trend has intensified with Trump’s tariff impositions and the resultant macroeconomic changes.
Bitcoin’s Correlation with Nasdaq
Bitcoin is more closely correlated to the Nasdaq 100 than other assets like gold. The relationship was strong in 2025, but in 2026, it became increasingly complicated, characterized by a recently weakening or even negative short-term correlation despite historically high levels late in 2025. While 30-day correlations reached a high of ~0.80 in November 2025, suggesting Bitcoin was acting as a high-beta, leveraged tech stock, recent trends show divergence from this trend. This is because Bitcoin has been trading significantly down from its peak, while the Nasdaq sits near record highs. In late 2025 and early 2026, the correlation turned negative (approx. -0.43 on a 20-day basis), marking a potential bottoming signal for Bitcoin as it fell over 25% from its highs while the Nasdaq remained near record peaks.
An important point to note is that the positive correlation between Bitcoin and the Nasdaq 100 is strongest during periods of market stress (risk-off), meaning Bitcoin tends to move in tandem with the Nasdaq during sell-offs. Even though the long term status of this correlation has been positive, a 1-year rolling correlation of around 0.38, as of January 2026, suggests short-term decoupling of Bitcoin and Nasdaq 100.
Reasons for the Tightening Correlation
Institutional adoption of Bitcoin positions it alongside tech giants in investment portfolios, which makes reactions to macro factors like interest rates and policy shifts higher than required. Studies confirm that Nasdaq predicts Bitcoin prices more accurately than Ethereum, with Bitcoin correlations at 0.64 versus Ethereum correlations at -0.03. Trump’s pro-crypto stance since 2025 has further aligned the behaviors of Bitcoin with the Nasdaq 100 during volatility.
Implications for the Investors
The Bitcoin-Nasdaq correlation has several implications for investors. Bitcoin is to be considered more as an entity that boosts the tech exposure of investors, rather than a hedge against inflation. Even though there have been divergences and negative correlations at times, it is temporary, say experts. Negative correlations could signal Bitcoin bottoms, offering buy opportunities.
