Bitcoin separates from stocks for the full year for the first time in over 10 years

Bitcoin has broken away from its long-standing correlation with stocks, posting a full-year divergence from stocks for the first time in more than a decade.

This shift highlights the growing disconnect between cryptocurrencies and traditional markets, raising questions about Bitcoin’s role in the current cycle.

Historical market decoupling

Bitcoin and stocks have historically moved in tandem.. HHowever, there seems to be a problem with that relationshipI took action.

The S&P 500 index is up more than 16% this year, while Bitcoin is down 3%, marking its first split since 2014, according to Bloomberg data.

Such a complete break is unusual even by cryptocurrency standards and prompts new scrutiny of Bitcoin’s role in global markets. This disconnect calls into question the expectation that regulatory optimism and institutional participation will automatically lead to sustained performance.

This is especially true given the broader environment in which artificial intelligence stocks are surging, capital spending is accelerating and investors are returning to equities. At the same time, traditional defensive assets are gaining traction, suggesting investors are reallocating risk rather than broadly embracing it.

Cryptocurrency-specific pressures, such as forced liquidations and a sharp decline in retail participation, have significantly exacerbated Bitcoin’s performance decline. Billions of unwound positions amplified the downward movement, turning what started as a correction into a setback for the industry.

As these signals accumulate, market sentiment weakens, sparking debate over whether this is a routine correction or a more significant structural change.

Regular pullback or more?

Bitcoin has long functioned as a momentum-driven asset, but the breakdown of its sustained uptrend suggests that leadership in the risk market has shifted elsewhere.

Flows into Bitcoin ETFs have slowed, prominent statements of support have muted, and key technical indicators are showing renewed weakness.

Price trends reflect that cooling confidence. Bitcoin has struggled to regain momentum since hitting an all-time high near $126,000 in October and is currently hovering around $90,000, reinforcing the sense that this divergence is driven not just by short-term volatility but by waning confidence.

Despite the current divergence, the longer timeline complicates the story.

Bitcoin continues to outperform stocks on a multi-year basis, suggesting that the recent split may reflect the unwinding of early excess gains rather than a definitive break in the trend.

From that perspective, despite the contrasting calendar years, the underperformance could still be consistent with a normal pullback within a broader bull market cycle.

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