📉 US stocks and crypto have finally decoupled.
Since the beginning of May, the S&P 500 has gained around 5% and continues to print new all-time highs.
Meanwhile, crypto hasn’t just corrected - it has been hit hard. Bitcoin is down roughly 18% from its May highs.
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📉 At first, crypto was shaken by conflicting headlines surrounding possible peace negotiations between the US and Iran.
But the real trigger came from Strategy, the world’s largest corporate holder of Bitcoin.
For years, Strategy symbolized the “buy and never sell” philosophy. Yet recently, the company sold a small portion of its holdings — just 32 $BTC
Financially, it’s an insignificant amount compared to their total reserves. Psychologically, however, it sent a powerful message to the market.
Crypto sold off sharply, and what initially looked like a normal correction quickly turned into a full-scale panic.
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🔮 What happens next?
In my opinion, there are three main scenarios:
1️⃣ Bitcoin and crypto once again act as leading indicators, signaling that US equities could eventually follow them lower.
2️⃣ This turns out to be an emotional reaction to the news cycle, and once the headlines calm down, crypto quickly recovers its losses.
3️⃣ Stocks and crypto gradually move back toward each other. Historically, both are considered risk assets, and they rarely diverge for very long.
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💡 For market nerds:
The estimated aggregate breakeven price for Bitcoin holders is currently around $54,000.
Historically, major market bottoms have often formed only after price dropped below this average cost basis, triggering widespread liquidations and flushing out weak hands.
Only after that kind of capitulation does the market usually become ready for a true long-term reversal.
That means we may still need one final wave of fear, pain, and forced selling before the next major bull run begins.
It wouldn’t surprise me if Bitcoin has to dip below $60K before it can truly move much high.
